Peer-to-Peer Short-Term Sharing on the Bilateral Commission Platform

Abstract

Nowadays, in order to achieve a large market share, peer-to-peer (P2P) sharing platforms try to attract both owners and renters. Since the supply is determined by the owners, there exist two supply cases: the supply shortage case and the supply surplus case. The owner determines whether to join the platform. If it's profitable for her to join, she then determines the rental time and the price to share. The platform determines commission rates charged from both owners and renters. In our model, the platform connects independent self-scheduled owners and heterogeneous renters through commission rates. We find the supply surplus case is more beneficial to the owner. The platform also benefits from this supply case by determining proper commission rates. We also find that high commission rates hurt the earnings of the owner side. High owner fraction hurts the earnings of the individual owner. The earnings of all owners and the platform's profit first increase then decrease in the owner fraction.