<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Research has documented racial or ethnic discrimination in online marketplaces, from labor markets to credit applications to housing. Platforms should therefore investigate how platform design decisions and algorithms can influence the extent of discrimination in a marketplace. By increasing awareness of this issue, managers can proactively address the problem. In many cases, a simple but effective change a platform can make is to withhold potentially sensitive user information, such as race and gender, until after a transaction has been agreed to. Further, platforms can use principles from choice architecture to reduce discrimination. For example, people have a tendency to use whatever option is set as the default. If Airbnb switched, for instance, ist default to instant book, requiring hosts to actively opt out of it, the company could reduce the scope for discrimination. It is important that discrimination and possible solutions are discussed transparently.</p>
</abstract>

Research has documented racial or ethnic discrimination in online marketplaces, from labor markets to credit applications to housing. Platforms should therefore investigate how platform design decisions and algorithms can influence the extent of discrimination in a marketplace. By increasing awareness of this issue, managers can proactively address the problem. In many cases, a simple but effective change a platform can make is to withhold potentially sensitive user information, such as race and gender, until after a transaction has been agreed to. Further, platforms can use principles from choice architecture to reduce discrimination. For example, people have a tendency to use whatever option is set as the default. If Airbnb switched, for instance, ist default to instant book, requiring hosts to actively opt out of it, the company could reduce the scope for discrimination. It is important that discrimination and possible solutions are discussed transparently.

Detecting and Mitigating Discrimination in Online Platforms: Lessons from Airbnb, Uber, and Others

NIM Marketing Intelligence Review

This work is licensed under the Creative Commons Attribution-NonCommercial 4.0 International License.

Research has documented racial or ethnic discrimination in online marketplaces, from labor markets to credit applications to housing. Platforms should...

Detecting and Mitigating Discrimination in Online Platforms: Lessons from Airbnb, Uber, and Others

Published Online: Oct 23, 2020

Page range: 28 - 33

DOI: https://doi.org/10.2478/nimmir-2020-0014

Keywords
Market Design, Platform Design, Discrimination, Field Experiments

© 2020 Michael Luca et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial 4.0 International License.

Detecting and Mitigating Discrimination in Online Platforms: Lessons from Airbnb, Uber, and Others

Published Online: Oct 23, 2020

Page range: 28 - 33

DOI: https://doi.org/10.2478/nimmir-2020-0014

KeywordsMarket Design, Platform Design, Discrimination, Field Experiments

© 2020 Michael Luca et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial 4.0 International License.

Keywords
Market Design, Platform Design, Discrimination, Field Experiments