Sharing economy, its characteristics, and how it affects the labor market

Abstract: In recent years, the sharing economy has been growing fast and gained attention from the media and scholars. There is much research that discusses and analyzes the sharing economy – its characteristics, its differences from traditional economy industries, and its potential problems which should be paid attention to. And a lot of research studies a specific area of sharing economy – Airbnb, and how it affects the hotel industry and tourism employment. I was inspired by those studies, in this thesis, I discuss the characteristics and development of the sharing economy, and how some consumer behavior is affected by psychological terms on sharing economy platforms, using behavioral economics knowledge. In addition, I try to run similar research with respect to the situation in European Union countries from 2018 to 2021. My hypothesis is that the rise of Airbnb and similar sharing economy accommodation platforms would have a negative effect on the traditional hotel industry but the impact of Airbnb on tourism employment is positive. I run panel data regression models to test the hypothesis. According to the results, the sharing economy accommodation platforms show a positive impact both on hotel performance and tourism employment. The sharing economy accommodation platforms and the hotel industry share not only a competitive but also complementary relationship.