Discrimination in P2P marketplaces: Do whites really make more money than blacks?
The Internet has been abuzz with a recently released study from the Harvard Business School that found that black hosts on Airbnb were charging 12% less than white hosts for similar listings. So is there discrimination on Airbnb? Do whites really make more than blacks on comparable listings?
The study authors, Benjamin Edelman and Michael Luca, looked at listings in New York City as of July 12, 2012. By using one set of paid sub-contracted workers to rate each listing’s photos on a scale of 1-7 (7 being “this is an extremely nice apartment, I would stay here even if it was more expensive than a hotel room” and 1 being “this is a terrible apartment I would never stay here”), and another set of workers to gauge race.
The duo then collected the specific listing information – including price and qualities like number of bedrooms, previous guests’ star ratings on things like location, communication, accuracy and cleanliness – to control for the quality of listing, and thus how the differences panned out between white and black hosts on comparable listings.
The study compared listings through statistical analysis based on number of bedrooms, social accounts linked, photo quality, communication rating, cleanliness rating, and location rating, among others. Picture quality ratings were perhaps the most subjective, and were not submitted by actual guests who stayed with hosts.