Airbnb Market Penetration and Its Relationship to Local Economic Development in the City of San Fernando, Pampanga

The sharing economy has changed the way people travel and find accommodations, and platforms such as Airbnb may help local areas generate revenue as visitors spend money on nearby establishments. This study examined the relationship between Airbnb market penetration and local economic development in the City of San Fernando, Pampanga (CSFP), Philippines, in terms of employment and income generation, local business growth, tourism and city revenue, and infrastructure and urban development. A quantitative descriptive-correlational design was employed. Data were gathered through a structured survey questionnaire from 285 respondents—225 local business establishments located near Airbnb listings, 47 Airbnb hosts, and 13 local government unit (LGU) representatives—selected through stratified random sampling with proportional allocation. Data were analyzed using frequency, percentage, weighted mean, standard deviation, and Pearson product-moment correlation. Results showed that Airbnb market penetration was very extensive (M = 3.33, SD = 0.51), as was perceived local economic development (M = 3.35, SD = 0.41). Airbnb market penetration had a strong, positive, and significant relationship with overall local economic development (r = .688, p < .001), strong relationships with employment and income generation (r = .652) and infrastructure and urban development (r = .640), and moderate relationships with local business growth (r = .406) and tourism and city revenue (r = .464). The findings suggest that Airbnb is associated with positive economic outcomes in the city; however, as its prevalence grows, policies that maximize its benefits, ensure fairness to all stakeholders, and minimize possible adverse social and economic effects are advisable.