Understanding Touristification in the Sharing Economy : Airbnb and the Housing Market

Over the past decade, the global rise of home-sharing platforms such as Airbnb has catalysed the process of “touristification” in major cities. “Touristification” is a term which has been recently used to describe a process which leads to the transformation of a community into a tourism commodity. But less is understood about how such home-sharing platforms affect housing submarkets. To understand the impacts of touristification on urban housing markets, we theorise the process using the spatial housing model, and hypothesise that the process could be associated with both gentrified (positive) and degentrified (negative) effects, ceteris paribus. We confirmed these two opposing forces of the Airbnb listing density on house-type versus apartment-type accommodation rents, using individual customer reviews as instrumental variables. Our findings imply that effective destination management should consider both the positive and the negative externalities which touristification renders