Virtue Signaling in the Sharing Economy: The Effect of Airbnb Entrepreneurs’ Virtue Language on Airbnb Price Premiums

Abstract

Drawing from costless signaling research, we examine the role of virtue language in Airbnb listings. We propose that virtue language espoused by entrepreneurs is beneficial for Airbnb price premiums—but only to a certain extent. Specifically, we argue that virtue language espoused by entrepreneurs has a curvilinear relationship with the price premium of their listings, suggesting that excessive use is seen as dishonest and becomes detrimental to their performance. We also suggest that this relationship is more pronounced when the entrepreneur is perceived to be more credible and when the entrepreneur is venturing into more conservative markets.