Wednesday, February 13, 2019

How Airbnb fights racial discrimination

HBR article documents that discrimination exists:
The sharing economy has a discrimination problem. Studies have shown that the sharing economy isn’t as open as we think: People of color are discriminated against on platforms such as Airbnb, Uber, and Lyft. A study of ride-hailing platforms found that black passengers were subjected to longer wait times and higher cancelation rates than white passengers. A study of Airbnb found that guests with African-American-sounding names were 16% less likely to be accepted by hosts than guests with white-sounding names.

This article suggests that this is statistical rather than taste-driven discrimination,
...if a host believes that African-Americans as a demographic group have higher incarceration and crime rates, the host will associate a prospective African-American guest with lower quality.

In other words, without information about guest quality, the "hosts may use race to infer quality."

Such statistical discrimination has a relatively easy fix, give the hosts more information about guests.  The authors ran an experiment that did this:
When a guest did not have any review information on their profile page, white guests had a much higher acceptance rate (48%) than black guests (29%). However, once each guest had at least one positive review, the acceptance rates became almost identical: 56% and 58%, respectively. 

 To fight statistical discrimination, platform companies should: a credible, easy-to-use online reputation and communication system. Bringing information to light, rather than trying to hide it from users, is more likely to be a successful approach to tackling discrimination in the sharing economy.


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