Hariri Graduate Fellow, Davide Proserpio to give Doctoral Dissertation defense

Davide Proserpio – Doctoral Dissertation Defense
Date: Friday, April 8, 2016
Time: 3:30 pm

Title: Peer-to-peer Rental Markets: Competition, Pricing Power, and Reputation.

Abstract: In the last decade we have witnessed the rise of new business models and marketplaces. A compelling example of innovative market design is represented by a set of platforms collectively known as the sharing economy. These platforms have emerged as alternative suppliers of goods and services that were traditionally provided by long-established, well-regulated firms. Services covered by the sharing economy range from transportation (Uber) to accommodation (Airbnb) to finance (Lending Club).

In this talk I will discuss some of the economic issues around these new platforms by focusing on Airbnb, a popular peer-to-peer accommodation rental marketplace. In the first part of the talk I will discuss the effect of sharing economy platforms on traditional firms, and provide empirical evidence that the sharing economy is making inroads by successfully competing with, differentiating from, and acquiring market share from incumbent firms.  In the second part of the talk I will discuss trust and reputation in the sharing economy, and show two seemingly conflicting facts: Airbnb ratings are implausibly high, yet informative. Then I will describe a novel analytical framework that, by introducing the concept of reciprocity, can explain the rating patterns observed in the field.

Committee:
Sharon Goldberg (First Reader)
Georgios Zervas
Chris Dellarocas
Michael Lucal

Chair:
John Byers