Estimating spatial effects on peer-to-peer accommodation prices: Towards an innovative hedonic model approach

Peer-to-peer (P2P) accommodations have scaled up in the wave of enthusiasm for innovative internet technologies, which challenge the conventional hotel industry. Pricing is a significant lever a P2P lodging host needs to improve profitability. The purpose of the present study was to examine pricing determinants of P2P accommodations considering their spatial dependency. Two spatial hedonic pricing models (HPM) were examined for site attributes and situation attributes, respectively. Three site indicators (count of bedrooms, accommodated person capacity, and overall review score) and four situation indicators (counts of P2P lodging listings, population density, unemployment counts, median income) contributed to the price of a P2P lodging list. The application of spatial HPM provides marketers and hosts on P2P lodging platforms more in-depth analysis and effective strategies for pricing.