
Airbnb a big boost to NYC economy, study finds - talhof8
http://www.metro.us/newyork/news/2013/10/22/airbnb-a-huge-boost-to-citys-economy-study/
======
JumpCrisscross
This is not an independent, peer-reviewed study. It was commissioned by
AirBnB. HR&A, the study's authors, point the interested to AirBnB's press
release versus a full paper [1].

One would be cautioned against taking its findings seriously. I am even
intrigued as to why AirBnB felt it was unnecessary or even counterproductive
to release the full paper.

[1]
[https://twitter.com/hraadvisors/status/393039913307758592](https://twitter.com/hraadvisors/status/393039913307758592)

~~~
NathanKP
The paper may be commissioned by Airbnb, but I think the fundamental findings
are pretty solid. Of course I'm probably fairly biased because I'm a pretty
heavy Airbnb user, with more than ten Airbnb stays in NYC in the last couple
years.

From what I've experienced Airbnb has allowed me to stay in areas of the city
that have few hotels or poor hotel coverage. I'm not the kind of person who
enjoys Midtown. I can't stand the tourist crowds, most of the restaurants are
horrible and there is no way in hell that I'm going to spend $200 a night of
startup money on staying at a Midtown hotel.

So when I'm in NYC with the startup I work for I'll stay in Williamsburg at a
cheap Airbnb place. Because of this I'm usually able to stay around three
weeks, and during that time my money is going to local restaurants, bars, and
convenience stores in Williamsburg and the LES.

All considered I probably still spend the same amount of money as your average
Midtown tourist, because I stay in NYC much longer even though my expenses per
day are lower than if I was staying in corporate hotels. But the important
thing is that the money I do spend is going to a local resident (90% of the
Airbnbs I've stayed at have been renting a room in the primary residence of
the Airbnb host), and to small local businesses, not to big corporate chain
hotels and chain restaurants in Midtown. I consider this to be a good thing.

------
ScottWhigham
I was fully expecting this to by a study "by Airbnb" and I wasn't
disappointed:

"On behalf of Airbnb, an online service for short-term vacation rentals, HR&A
conducted an economic impact assessment of Airbnb rental activities in the
City of San Francisco, and is currently conducting a follow-up study of its
impacts on New York City."

[http://www.hraadvisors.com/featured/economic-impacts-of-
airb...](http://www.hraadvisors.com/featured/economic-impacts-of-airbnb/)

~~~
ajiang
Yep. I actually think it would be valuable to have a third-party non-profit
entity that provides economic impact assessments of start-ups like Uber and
Airbnb, so we are backing up our regulatory policy changes on data rather than
emotion or lobbying.

~~~
yeukhon
non-profit do you mean university? I'd rather have university do the research.

I often think non-profit is not as independent as we think. After all, a lot
of non-profit are to advocate against public policy. Whereas usually
university research (from multiple sources) seem to be more independent.

~~~
ajiang
I agree that non-profits can and often are not independent of private
influences. Universities can fall under the same influences as well, such as
MIT's concrete research studies being funded and advocated by the Portland
Concrete Association.

In this situation, I would have liked to see an independent non-profit or
University group that was funded 50/50 by New York City and Airbnb to do the
study. Perhaps you can argue that the funding arrangement is not perfect, but
it's definitely a step in the right direction.

~~~
yeukhon
You are right. Maybe we should see multiple sources. That's fair, from
government to non-profit to university.

------
ritchiea
As a New Yorker looking for an apartment I've really come to despise Airbnb.
Housing has obviously always been expensive here, but it's reached new heights
this year. I'm looking in Brooklyn and not only are the rents higher than I've
ever seen them, but it's much more difficult than before to find a bedroom in
an existing household (via craigslist, etc). All the while I encounter an
increasing number of people, friends, acquaintances, friends of friends, who
say they have a bedroom in their apartment that they keep open to rent out to
Airbnb guests. I know this is HN and someone is going to say this is just an
anecdote, and clearly that's true, but there's no doubt Airbnb is not just
competing with hotels, it's also lowering housing availability in desirable
neighborhoods, and likely raising prices in an already expensive rental
market.

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CodeCube
This is something I see often ... a company wants to prove some positive thing
about their business, so they commission a study, only to have it torn down in
comments because it was they who paid for it.

I _totally_ get that it's a conflict of interest, but what alternative is
there? Seems like a study of this kind is really valuable to be able to
contribute to the policy conversation that's currently underway. Would the
only ethical option be for AirBnB to put out a public call for someone,
anyone, to do this study on their own dime? Who would do such a thing without
being paid up front? Would it still be a conflict of interest if the
researchers put up a crowdfunding campaign to pay for the study (even if they
did so at the behest of AirBnB)?

~~~
NathanKP
I agree. Rather than arguing against the data in the study its easy to just
use the strawman argument of "but it's paid for by Airbnb so it must be
biased."

But I will say that I would like to see the actual original data in the study
instead of just the numerous blog posts about the study. I did some internet
searching and was unable to find the original study, just news articles about
it. If we had the original study and we could see the data sources and actual
data points then we could have a real discussion about whether or not the
study is legitimate.

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cylinder
Bunch of garbage. Enabling tourists to stay in different neighborhoods doesn't
grow the economy, it just shifts where some of the money is spent from midtown
to downtown.

~~~
pkfrank
Without arguing the motivations of this "third party" study, you ignore the
fact that it finds:

\- People stayed longer and spent more

\- Money ended up in individuals' hands, instead of a hotel megacorp chain

\- Much was outside Manhattan (a distinction from your claim of "midtown to
downtown")

~~~
dfc
Without access to the report it seems that any discussion is difficult. I
think the only thing you can say is that OP is "ignoring the fact that
metro.us reported HR&A's claims to have made the following findings:"

------
dfc
Can anyone comment on the difference between "contributions to total spending
in the city economy" and "economic activity generated in the city"? I am
curious about the disparity in these two statements:

SF: _From April 2011 May 2012 guests and hosts utilizing Airbnb have
contributed $56 million in total spending to San Francisco’s economy_ [1]

NYC: _Over the course of a year, Airbnb generated $632 million in economic
activity in New York._ [2]

Another question I have is how would the authors identify the economic
contributions of AirBnB hosts in San Francisco? And/or how they would
distinguish between the contributions that were the result of AirBnB and those
contributions that would have happened without AirBnB?

I am aware of HR&A's motivations.[3] I am not trying to criticize the report I
am interested in the actual analytical process.

[1] [http://assets.airbnb.com/press/press-
releases/Economic_Impac...](http://assets.airbnb.com/press/press-
releases/Economic_Impact_Study.pdf)

[2] [http://www.metro.us/newyork/news/2013/10/22/airbnb-a-huge-
bo...](http://www.metro.us/newyork/news/2013/10/22/airbnb-a-huge-boost-to-
citys-economy-study/)

[3]
[http://www.paulgraham.com/submarine.html](http://www.paulgraham.com/submarine.html)

~~~
nonchalance
Apple put out similar hand-wavey figures last year:
[https://www.apple.com/about/job-creation/](https://www.apple.com/about/job-
creation/)

I think the point boils down to:

1) dollars paid to hosts are counted towards the city economy (ostensibly most
of those would be spent in the city) -- this is direct

2) renters need to eat etc, and those monies should be counted to the economic
activity -- this is indirect

~~~
dominotw
>renters need to eat etc Wouldn't they have to eat regardless of where they
stay?

~~~
nonchalance
If you are staying for a day or two, you most likely would go out and eat your
meals (including breakfast). For longer stays, especially with kitchen access,
you probably would buy cereal, milk, juice, and other items. If you are
estimating the cost of food based on average or median restaurant, you aren't
capturing the true dynamics (note: as they said in the report, the average
stay is close to a week in length)

------
datatad
I happen to work for a company that does economic impact assessments, and I'm
skeptical of this "study", to say the least (it's hard to tell w/o a link to
the full paper, only a press release). Basic unanswered issues:

(1) How do you show how many guests would not have come to NY at all if AirBnB
didn't exist? This is called the counterfactual. (If they would have come
anyway, then hotels lose the same amount of business, leading to no net gain.)
And, if money is just being shuffled from midtown to the outer boroughs, how
is that a net win for NYC? Broken window fallacy, anyone?

(2) I guess you _could_ argue that NYC is better off if the same dollars are
going to residents rather than corporate hotel chains (if you show higher
multipliers, maybe some good externalities like supporting artists). But
that's a very complex assessment in itself, likely way beyond the scope of
this study. And you've got to count only _net_ benefit versus the
counterfactual.

(3) Sure, AirBnB guests might stay longer and spend more (what data is that
based on? Don't many people use AirBnB because it's cheaper?), but that
correlation doesn't mean that some magic AirBnB pixie dust caused them to do
so. And is this offset by less money spent on the lodging itself compared to
an hotel?

------
jriley
Anecdote for my sister in Texas: 2010: Started renting her house on AirBnB to
build savings / side-income. 2011: Left full-time design job. 2012: Repaired
house and added efficiency unit. 2013: Picking up freelance design work.

Results: She works less hours overall, but feels need to respond to AirBnB-
related requests at all hours. Now has ~20% higher income but less
predictability. She pays taxes. AirBnB taught her several skills necessary for
entrepreneurship. Still cringes when there is a critical review.

Her local bars and cafes definitely benefit from her guests (she provides
local recommendations). I suspect local hotels might be losing some but not
all of the business. Her guests pay roughly 25% less than local hotels.

She also travels more now, and has built a network from people who have stayed
with her. Examples: Helped plan a wedding, assisted commercial photo shoots,
went for drinks when visiting former guests’ cities.

------
dominotw
>Airbnb users helped prop up 4,580 jobs throughout the five boroughs

I am courious about how they calculated such precise numbers

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kmfrk
Is the report even available anywhere? Did Metro just take the claims by HR&A
at face value?

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fennecfoxen
Don't worry. The next mayor, Bill de Blasio, will be certain to put an end to
this sort of horrible monstrous abuse of the city, in the name of Affordable
Housing and Tenants' Rights. :P

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codex
Dumping industrial waste into the Hudson, prostitution, and the drug trade are
also boosts to the local economy. Think of all the jobs! However, they are are
illegal in NYC, just like Airbnb, though the externalities are much worse in
those cases. The point is that most laws restrict a bit of economic freedom
for other societal benefits. Think of how much cheaper housing would be if
only we ditched those pesky building codes!

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deltron
I love airbnb, I just used them for my honeymoon (though that was in Athens,
Greece).

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junto
Would probably be more if everyone paid tax on those earnings.

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dominotw
Now this post disappeared from the front page.

