Comment by krschultz | Hacker News Reader

Comment by krschultz | Hacker News Reader

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I think that way, and I think your math is super hand wavy. I can't think of a trip I've taken in the last few years where incidental expenses exceeded the cost of airfare + hotel.

If you spend $50 a day on food in NYC with a sales tax of ~9% we are talking about $4.50 a day. And $50 a day is high, if we are talking about people that are so price sensitive that they won't come to NYC at all without AirBnB.

Of the top 10 rooms listed in the AirBnB report, $100 a night seems to be the median price. With a hotel tax of ~6%, that should be $6 a day.

You can nab a real hotel room in NYC for $200 a night (with some work, even less). That yields ~$10 to the city a night in hotel fees.

It's hard to say without knowing a lot about price sensitivity whether or not your argument is true, but on the surface of it, I don't see it. Are there that many people that can buy a plane ticket, pay $50 a day in food, and $100 a night for AirBnB, but CAN'T pay $200 a night for a hotel?

I would imagine that more likely it changes the length of peoples stay. Maybe with AirBnB you can come for 6 days instead of 4 or something like that. But if AirBnB currently doesn't pay any taxes, I'm don't see how 6 days of sale tax instead of 4 makes up for the lost hotel tax.

> "If you spend $50 a day on food in NYC with a sales tax of ~9% we are talking about $4.50 a day. And $50 a day is high, if we are talking about people that are so price sensitive that they won't come to NYC at all without AirBnB."

I agree with the general notion that the wider economic benefits of AirBnb are a bit suspect.

But the benefit to the city isn't just direct income via taxes. That $50 on food results in $4.50 in tax revenue, but also pays the cook, the waiter, the restaurant owner, the guy who owns the building it's in, and the supplier (who probably operates from NJ, but whatever).

Considering how slim restaurant margins are, it's pretty safe to say ~90% of that $50 goes straight back into the economy. The city after all isn't just there to collect tax money, it's also responsible for creating jobs.

If AirBnb was dramatically cheaper than NYC hotels it'd still be a benefit to incur even low levels of tourist spending from tourists who were otherwise unable to afford to travel here. That said, having looked at a lot of AirBnbs in NYC before, they are largely not much cheaper than hotels.

Only the extreme end of sketchy AirBnbs are notably cheaper, and that has negative externalities to the extreme.

I think his point is not about an individual's spending habits but the increased spending of the population as a whole. A breakeven analysis is needed. Income elasticity of demand... that sort of thing.

You have to compare the cannibalization of lost hotel sales to the revenue from AirBnB sales and increased airline sales and increased incidental revenue etc and say "ok now we think X many more people will make the trip because the bar has been lowered". Then you drink a nice cool refreshing Dr. Pepper, and maybe book a trip to Denver to buy some edibles.

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