Collaborative Housing and the Intermediation of Moral Hazard

This paper considers intermediation in a differentiated short-term housing market where heterogeneous agents may stay at a hotel or at one of several private hosts' properties, below or above hotel quality. The collaborative-housing market fails when agents' hidden actions are noncontractable. If expected liability is not excessive, a trusted intermediary can induce agents to exert first-best effort and fully insure the hosts' risks, without subsidizing the transactions. The intermediary can also extract the hosts' surplus if their outside option is zero; somewhat counterintuitively, the commission on either side of the transactions does not affect agents' equilibrium payoffs. The optimal commission structure makes direct transactions between hosts and renters unattractive.


Editor(s):
Sprague, Rh
Published in:
2014 47Th Hawaii International Conference On System Sciences (Hicss), 4133-4141
Presented at:
47th Annual Hawaii International Conference on System Sciences, Waikoloa, HI, JAN 06-09, 2014
Year:
2014
Publisher:
New York, Ieee
ISSN:
1060-3425
ISBN:
978-1-4799-2504-9
Laboratories:




 Record created 2014-12-30, last modified 2018-09-13


Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)