Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/312084 
Year of Publication: 
2024
Series/Report no.: 
CESifo Working Paper No. 11574
Publisher: 
CESifo GmbH, Munich
Abstract: 
This paper investigates the impact of price transparency on equilibrium prices and fees by considering a policy change implemented by Airbnb that affected the transparency of cleaning fees for IP addresses from the European Union (EU). Using a difference-in-differences approach, we find a reduction in cleaning fees of 2-4%. Consistent with our theoretical framework, we also find that listings without a cleaning fee, something that is common on Airbnb, appear more affordable after the policy change and react by increasing their nightly price by 5-6%. We argue that this result is driven by some hosts learning about the full prices of their rivals due to the transparency policy, finding themselves more affordable. This analysis uncovers a new mechanism through which greater price transparency can lead to price increases.
Subjects: 
price transparency
obfuscation
cleaning fees
JEL: 
D40
D80
L10
L20
L40
Document Type: 
Working Paper
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