The impact of Airbnb’s competitive pricing on traveler spending at destinations

The emergence of digital short-term rental (STR) platforms has significantly transformed the business landscape of the tourism and hospitality industry. This research examines the impact of Airbnb’s competitive prices on traveler behaviors at destinations. Using an experimental approach, the study explores the spending intentions of travelers who choose cost-effective Airbnb accommodations over traditional lodging. Results indicate that travelers tend to re-spend savings from Airbnb stays at visited destinations, supporting both direct and indirect rebound effects. Notably, intended re-spending amounts exceed initial cost savings on accommodations, potentially increasing overall tourism income. Findings also reveal that (a) re-spending intentions are driven by heightened pleasure from cost savings, and (b) the effects’ magnitude depends on prior destination experience and uncertainty perceptions toward Airbnb stays. These insights offer implications for destination practitioners, local authorities, and STR platform designers.