The economic impacts of short-term rentals and regulations: A literature review

Alberto Hidalgo and Francisco J. Velázquez

No 2026-02, Working Papers from FEDEA

Abstract: Short-term rental (STR) platforms such as Airbnb have reshaped urban and tourism economies worldwide. By lowering transaction costs and enabling peer-to-peer accommodation at scale, they have expanded visitor capacity beyond traditional hotel districts and channeled tourism demand directly into residential neighborhoods (Zervas et al., 2017; Farronato and Fradkin, 2022). This transformation a!ects multiple urban markets simultaneously (housing, local economic activity, tourist accommodation, and neighborhood dynamics), making STR one of the most consequential developments in contemporary urban policy.

Date: 2026-02
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