Broad and narrow price parity agreements: Evidence from European hotels
Abstract
This paper investigates the effect of “price parity” clauses in contracts between hotels and online travel agencies (OTAs). These restrictions require a hotel to set its lowest prices for a given room on a travel agency’s website and have come under recent scrutiny by antitrust regulators. We use a synthetic control strategy to study a series of policy changes in Europe using novel data on transacted hotel prices and occupancy. Our analysis finds that (i) restricting the broadest form of parity clauses, but leaving in place a more limited version, reduced prices by about 1.5% and increased occupancy by 1 percentage point; (ii) relative to narrow parity, a complete ban on parity clauses reduced prices by between 0 and 4%, but had no impact on occupancy.
Fields of Study & Subjects
Consumer Market Behavior and Pricing
Sharing Economy and Platforms
Auction Theory and Applications
Publication details
- Journal / source
- International Journal of Industrial Organization
- Publisher
- Elsevier BV
- Volume
- 105
- Pages
- 103265–103265
- Publication date
- 3 February 2026
- Language
- EN