Can Information Reduce Ethnic Discrimination? Evidence from Airbnb

Morgane Laouénan () and Roland Rathelot
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Morgane Laouénan: CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, LIEPP - Laboratoire interdisciplinaire d'évaluation des politiques publiques (Sciences Po) - Sciences Po - Sciences Po

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Abstract: We use data from Airbnb to identify the mechanisms underlying discrimination against ethnic minority hosts. Within the same neighborhood, hosts from minority groups charge 3.2 percent less for comparable listings. Since ratings provide guests with increasingly rich information about a listing's quality, we can measure the contribution of statistical discrimination, building upon Altonji and Pierret (2001). We find that statistical discrimination can account for the whole ethnic price gap: ethnic gaps would disappear if all unobservables were revealed. Also, three-quarters (2.5 points) of the initial ethnic gap can be attributed to inaccurate beliefs of potential guests about hosts' average group quality.

Date: 2022-01-01
Note: View the original document on HAL open archive server: https://hal.science/hal-03930675v1
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Citations: View citations in EconPapers (5)

Published in American Economic Journal: Applied Economics, 2022, 14 (1), pp.107-132. ⟨10.1257/app.20190188⟩

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Journal Article: Can Information Reduce Ethnic Discrimination? Evidence from Airbnb (2022)
Working Paper: Can Information Reduce Ethnic Discrimination? Evidence from Airbnb (2022)
Working Paper: Can Information Reduce Ethnic Discrimination? Evidence from Airbnb (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03930675

DOI: 10.1257/app.20190188

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