The Categorical Paradoxes in the Sharing Economy: Empirical Evidence from Airbnb

Challenging conventional epistemological stances, we unravel two paradoxes of communication strategies in the emerging context of sharing economy. Specifically, the conformity–distinctiveness paradox asserts that differing from hotels improves hosts’ economic performance, but such economic benefit diminishes when deviating from the norms in hospitality settings. The economic–social paradox propounds that positioning away from hotels improves social performance but may not result in optimal economic gains. Drawing on the theoretical underpinnings of strategic categorization and optimal distinctiveness, we collect and analyze data from a sample of Airbnb listings. Utilizing multiple estimation models and identification strategies, we find that hosts can improve their economic performance by differing from hotels, but such economic gains diminish beyond a certain point. Furthermore, deviating from hotels also increases hosts’ social performance, especially when direct host–guest interactions occur in shared apartments. Our empirical findings provide compelling evidence for the two paradoxes in the context of sharing economy, extend the discourse on strategic categorization, and elucidate the effects of listing narratives conveyed through social technologies. This study also sheds new light on how operations management and service providers can exploit the communicative and linguistic perspectives of user-generated content.