Rankings of online travel agents, channel pricing, and consumer protection

We investigate whether online travel agents (OTAs) assign hotels worse posi-tions in their search results if these set lower hotel prices at other OTAs or on their ownwebsites. We formally characterize how an OTA can use such a strategy to reduce pricedifferentiation across distribution channels. Our empirical analysis shows that the positionof a hotel in the search results of OTAs is better when the prices charged by the hotelon other channels are higher. This is consistent with the hypothesis that OTAs alter theirsearch results to discipline hotels for aggressive prices on competing channels, therebyreducing the search quality for consumers.