How Airbnb Is Silently Changing Himalayan Villages

Above my mountain-top cottage in a beautiful Himalayan village, the road ends and the forest begins. After sunset, flying squirrels come out. Leopards occasionally growl outside the cottage. There is no habitation nearby, except a small village of hundred people where houses stand so close to each other that people can watch over each other for good. In their houses, people, cattle and mountain dogs coexist. There is no shop or restaurant nearby. There is nothing for many miles down, except pine forests and a narrow, unpaved road. Even the narrow, unpaved road didn’t exist a few years ago. Then there is a river. Everybody knows everybody else. It is hard to make an advance at a river girl without all mountain girls hearing about it. Crime is almost unheard of.  I live at the end of the habitable world.

A year ago, when I began to travel into eastern Himalayas, I put my cottage on Airbnb. It didn’t take long for it to become one of the most successful Airbnbs in my state, raising my landlord’s income beyond his wildest hopes. A decade ago, this would have been hard to imagine. My town is not very different from the United States at the end of the 18^th Century. The family is still the fundamental business unit. People work alone in their family farms or one-man shops, some with a nephew or two as help. The rule of the clan is in its full glory. Everybody is on Facebook and Instagram, and nowadays, on Airbnb. But in many ways, time has remained still. It’s an unlikely location for a successful vacation rental, but Airbnb made this possible.

When they drive up the hill, even our happiest guests fear there can’t be anything good at the end of this. It’s the rare sort of person who doesn’t get cold feet when he drives up the narrow, winding road. This doesn’t bother me, because they’ve already made the payment. They’ll almost certainly write glowing reviews, because good memories are about good endings. A mountaintop cottage out of nowhere wouldn’t have had much success not long ago. It’s not for everybody. Quirky spaces have always had a market, but it was hard to bring them to people. People didn’t pay attention if your property wasn’t centrally located. Travel agents have a limited shelf space. Anything offbeat can be a bit hit-and-miss. But it isn’t hard for an offbeat product to outcompete mainstream products on Airbnb. If guests love the experience, you’ll get plenty of long, heart-felt, perfect reviews. It won’t take long for your property to appear on the top, when potential guests look up your neighborhood.

Cognitive anthropologist Pascal Boyer once said that theory is information for free. Airbnb works a bit that way. A great theoretical framework explains the world the same way Airbnb makes a mountaintop cabin useful. With a great theoretical framework, you work with the pieces of information you’ve always had, but you see what you hadn’t seen before. When you list your mountaintop cabin on Airbnb, the property doesn’t change physically, but it suddenly becomes useful.

Many hosts who were tried and found wanting want to believe this is easy, semi-passive income. But this is not true. I remember the winter I came back to my mountaintop cottage. My landlord had come back from a festival that took a month of his life. He started leveling the land around the cottage built on a rock, to build a lawn. There wasn’t much land around it. It snowed heavily, and his nephew deserted him. The wind blew hard, and my pup came inside the quilt. Through the glass panes of my window, I saw him working outside the cottage till the snow dusted everything including him, and it turned dark and nothing was visible. When it became dark, the man with the mattock became distinct, as in a black-and-white movie. The snowfall became more intense. I could hear the snow falling on the roof. My pup shivered inside the quilt, and the villagers who walked down the path to the last house on the hill laughed. I opened V.S. Naipaul’s ‘A Bend In The River’ and read the opening line, “The world is what it is; men who are nothing, who allow themselves to become nothing, have no place in it.” In a world without Airbnb, men like him, too, may have allowed themselves to become nothing.

It’s very expensive to farm in Himalayan villages like mine. The farms are quite small, and can’t leverage economies of scale. The law forbids selling land to outsiders, but the tyranny of the state pale in comparison to the tyranny of social norms. Most hill people see the process of selling land as a humiliating ordeal they would never consider. Everybody chips in to cultivate the land. Women spend many hours a day cutting grass for their own cows. This is not yet a division of labor society. It is this world Airbnb has penetrated, turning it upside down. In the beginning, nobody paid attention. People didn’t take well to the orderliness of an American company. Now everybody wants to get on it.

Millions of people stay in Airbnb homes every night. It’s not trust which makes this possible. My pup is fearless when he sleeps with the door wide open, in a cottage in the woods. There are leopards around. Dogs here don’t live very long. He doesn’t trust leopards, but he knows they are afraid of humans. My pup sleeps on my bed, and so is well-protected from the vicissitudes of life. But I’m not the living proof that dogs can trust leopards. Dogs wouldn’t need humans to guard them if they could trust leopards. Similarly, Airbnb puts hosts and guests in a position where behaving badly would ruin their reputations. In one of my bad moods, I held my pup quite firmly. At midnight, he ran out of the cottage and barked for hours. I couldn’t bring him back to my bed. I did something he thought I wouldn’t consider. He felt I betrayed his trust in me. I’m, here, talking about a more meaningful form of trust. Intellectuals miss this obvious distinction, because they’re not the wonderful people they think they are. The distinction between trust and assurance is all too obvious. But if doing wrong doesn’t fill you with moral horror, you won’t get it. You can’t trust anybody who doesn’t feel that way, and there are not many such people. Unconditional trustworthiness is one of the rarest things in the world. Institutions can’t produce this kind of trust, because people aren’t conditionable beyond a point. In any case, how do you produce something you don’t even understand?

To do well on Airbnb, you’ve to come across as a good fellow. It’s alright to cheat so long as you aren’t caught. But this doesn’t mean you’ll game the system if you’re a bad person with perfect impulse control. It’s easier said than done. Impulse control is hard, especially for opportunists. The pleasure of behaving badly comes soon enough, but the penalty of a bad review comes a few days later. If you’re a bad person, you just can’t help it. I’ve seen this in other domains of life, and I see this in hosts. They can’t help overcharging their guests. And they cut corners on the “free” breakfast they offer. They always think other people are trying to get the better of them, and so it’s hard for them to stop trying to get the better of other people.

You can’t solve evolutionarily novel problems without really thinking them through. The internet is evolutionarily novel. In the ancestral environment, there was no formal third-party enforcement of norms. There was usually no penalty for treating outsiders dishonestly and unfairly. The Airbnb review system is an extremely powerful third-party norm enforcement system. Most hosts don’t understand how formal third-party enforcement of norms work. When the hosts try to deceive guests through evolutionarily familiar ways, the penalty comes in evolutionarily novel ways. A negative review can haunt you for very long, but it’s hard for many hosts to get their heads around this.

Then there is pricing. Airbnb has tools that help you price your home right, allow the price to fluctuate according to supply and demand, and offer last minute discounts. But hosts believe there is a fair, fixed price for everything. In our fairly stable, hunter-gatherer past, there was no market pricing because they didn’t trade with strangers. There was only authority ranking, communal sharing and equality matching, as anthropologist Alan Fiske points out. The price can’t vary according to supply and demand if you’re equality matching. In a fairly stable environment, you can’t be a better bargainer if you settle for less when something is less valuable to you than usual. Hunter gatherers who felt too much humiliation and envy when they got less than usual were better bargainers, and had more reproductive success. When Airbnb’s “smart pricing” brings the prices down, hosts think they got the short end of the stick. They have too much pride to lower the prices even when the demand is ridiculously low. They don’t see why they can’t get more out of an app by bargaining with it, because apps are evolutionarily novel.

I manage the Airbnb listings of several hosts, and they wonder why the properties of highly rated hosts are more expensive than theirs. They can’t help thinking this is authority ranking, in which dominant people grab what they want from low-status ones. They expect more communal sharing. Human diversity is vast, and when everybody is free to list their homes, stars are inevitable. As Clay Shirky said long ago, when you reverse the star system, you destroy the village in order to save it.

The best Airbnb hosts don’t feel very tempted to overcharge or deceive their guests. They don’t feel too much envy or humiliation when they offer their guests a great, mutually beneficial deal. They would have found this hard to pull off, if they were continually fighting the temptation to misbehave. When you look at things this way, the distinction between genuine trustworthiness and benign, self-interested behavior seems to be a matter of degree. It doesn’t seem all that different. So is being a good host about being a good person, as Airbnb’s Joe Gebbia says? The bar, here is, way too low. You don’t need to be unconditionally trustworthy to fare well in short-term interactions. It is enough to have high social intelligence and be moderately trusting and trustworthy. Airbnb can’t produce genuine trust. No institution can.

Where, then, do you need genuine trust? In Himalayan villages like mine, there is deep social uncertainty because of Airbnb and other online marketplaces. The opportunity cost of doing business with one’s nephews and cousins is now high. There is the real problem of nephews who run away on the flimsiest of pretexts. The stakes are higher, and there is much to gain by trading with outsiders. You can’t even run Airbnbs well without breaking free from closed relationships with your family and tribe, and forming spontaneous relationships with strangers.  It’s hard for me to do justice to my Airbnb listings without being free to run them in a fairly entrepreneurial fashion. An outsider can’t lease land, if he isn’t sure the landlord would honor the contract in letter and spirit. Vast, hidden opportunities aren’t exploited because it takes unconditional trustworthiness. There are valuable transactions that don’t take place because they aren’t negotiated in the first place. We lose sleep over what we see, but what is unseen is often more important.

Airbnb provides enough assurance to get millions of people on the beds of strangers every night. There is something to be said for trust here. But people are strong norm-followers. There is little to fear. I travel for months at a time, and usually stay in the houses of strangers which aren’t on Airbnb. I write this from the house of a stranger who knows absolutely nothing about me. It probably never occurred to her this is strange. And I’m in a remote village where outsiders weren’t allowed not long ago.                                                                                        

PS: Thank you all, for sharing my essay. Tyler Cowen, at Marginal Revolution | John Naughton, in The Guardian | New York Post  | Jake Seliger, The Story’s Story | Daulat Jha | Hacker  News |  The Browser | Bookofjoe | The Morning New | Real Clear Investigations | View From The Wing | Jason Potts | John Rentoul | Rory Sutherland |Agnes Callard | Arthur Charpentier | Gwern

Shanu Athiparambath

Shanu Athiparambath is a writer who lives in the Himalayas. He is working on his debut novel on human heterogeneity.