Junior Research Seminar: Nicola Fontana (London School of Economics)

Title: "Backlash against Airbnb: Evidence from London"

  • Date: 18 January 2021 from 12:00 to 13:15

  • Event location: Microsoft Teams


Anti-globalization sentiments have been on the rise in recent years. In urban contexts, these attitudes may take the form of backlash against tourism. In this paper, I examine the role of Airbnb, a major short-term rental platform, in explaining the rising discontent against tourists. To do so, I construct a rich and spatially disaggregated dataset to study the consequences of Airbnb penetration in London. First, I document that 1 additional Airbnb tourist per 1000 residents increases complaints against tourists by 2.2 per cent. Secondly, I explore the roots - pecuniary and non-pecuniary - of these reactions. I find that higher Airbnb penetration is associated with a decrease in neighbourhood quality, while the housing market is only marginally affected. These negative externalities can be explained by a lack of monitoring and coordination by hosts, which are key differences between short-term renting and traditional hotel accommodations. Finally, I provide evidence that the deterioration of neighbourhood quality markedly reduces social capital, as measured by the number of charitable organizations, and worsens attitudes towards globalization, leading to higher support for Brexit. 

Local Organizer:  Margherita Fort, Annalisa Loviglio

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