Security Policies in the Shared Economy:

The Case of Airbnb

Daniel Kapellmann | Priya Sudendra | Julieta Sanchez

A little bit of background● Shared Economy

○ Technology to share oversupply

○ Peer-to-peer sharing platforms

○ Companies act as intermediaries

○ Wide market, substantial economic growth

● Airbnb○ “Is a trusted community marketplace for people to list, discover and book unique

accommodations around the world” ○ Reputation and verification systems to establish trust between users

○ Extensive policies regarding responsibilities by guests, hosts and Airbnb

○ Challenge: keeping both hosts and guests safe without direct involvement

How effective are Airbnb’s policies in guaranteeing the physical safety of its users?

Should We Care?... Of Course!

● Technology advances faster than policies enacted

● Lack of governmental regulation in the new shared economy

● Challenge: Guarantee safety of all users… from the distance

● Lack of clarity on ethical and moral framework analyses

● Promote reflection of moral implications for companies while enacting policies

● Little information for truly elaborating consistent shared economy evaluations

that allow the generation of robust mechanisms to protect the users

Stakeholders17 million guests (summer 2015)

Sources: http://blog.airbnb.com/wp-content/uploads/2015/09/Airbnb-Summer-Travel-Report-1.pdf http://money.cnn.com/2015/06/27/technology/airbnb-funding-valuation-update/ http://blog.airbnb.com/airbnb-open-chips-takeaways/

Over $25 billion dollars150 countries

640,000 hosts

$427 billion revenues

Ethical Frameworks

Utilitarian

If Airbnb cares for the users and invests in stronger protection/transparency mechanisms it will improve social utility by supporting travelers on meeting new

places in a cheap and safe manner.

DeontologicalAirbnb is motivated to the safety of users, so the policies implemented by the firm should be relevant in protecting all stakeholders and strictly followed by all users.

Capabilities Approach

Users should be enabled to travel and enjoy staying in safe environments so that they can make decisions by themselves. Airbnb should promote the consolidation

of this environment to provide them with capabilities for making the choices.

Policy Strengths WeaknessesCost for Airbnb

Impacts

Transparency

Enhanced communication with

users, decreasing negative legal implications

Policies should be substantial, yet simple to get users engaged

Low

May make them feel safer but it could also lead to mistrust

due to policies the users don't agree with.

Adopt industry policies

Rules and regulations for hosts to follow

Difficult to police all listings, defeats

purpose of "shared economy" and self

regulation

High Changing business model

"Secret Shopper"

Transparency, outsourcing to

existing guests to monitor

accommodations.

Results of compliance testing may be skewed

LowSelf-regulated system.

Transparent

Final Recommendation● Existing policies and rules clarified for hosts and guests to follow

● “Secret Shopper” system○ Random, anonymous○ Enforcement of rules

● Reinforces shared economy model of self-regulation