The impact of compensation information transparency on guest booking behavior in the home-sharing economy: an asymmetric information perspective

Purpose – Compensation policies are crucial for addressing guest incivility within the home-sharing economy; however, their influence on guest booking behavior remains underexplored. This study aims to explore the impact of compensation information transparency (CIT) on guest booking behavior and the underlying mechanisms. Design/methodology/approach – To achieve the research aims, this study used panel data of 5, 185 Airbnb properties from 1, 905 hosts from Beijing, China, and conducted a randomized experiment. Findings – The findings suggest that CIT significantly increases guest booking behavior through the mediating roles of perceived trust and perceived risk. In addition, this effect is strengthened by cancellation policy and weakened by response times. Practical implications – The findings offer valuable insights for hosts regarding the use of compensation policies to effectively manage guest misconduct and simultaneously enhance sales volumes. In addition, this research provides guidance for managers of home-sharing platforms on improving the clarity and effectiveness of compensation disclosure. Originality/value – This study offers novel insights into the economic impact of compensation regulations designed to mitigate guest misconduct on home-sharing platforms, advances research on consumers compensating for consumer misbehaviors and provides guidance on applying asymmetric information theory within the sharing economy.