Racial Bias in the Sharing Economy and the Role of Trust

105 Pages Posted: 13 Aug 2019

See all articles by Katrine Berg Nødtvedt

Katrine Berg Nødtvedt

Norwegian School of Economics (NHH) - Department of Strategy and Management

Hallgeir Sjåstad

Norwegian School of Economics (NHH) - Department of Strategy and Management

Siv Skard

Norwegian School of Economics (NHH)

Helge Thorbjørnsen

Norwegian School of Economics (NHH) - Department of Strategy and Management

Jay Van Bavel

New York University (NYU) - Department of Psychology

Date Written: August 8, 2019

Abstract

The rise of peer-to-peer platforms is one of the major economic and societal developments in the last decade. We investigated whether people engage in racial discrimination as consumers in the sharing economy. Using a set of carefully controlled experiments (N = 1,599), including a pre-registered study on a nationally representative sample, we find causal evidence for racial discrimination. When an identical Airbnb apartment is presented with a racial out-group (vs. in-group) host, people report more negative attitudes towards the apartment, lower intentions to rent it, and are 25% less likely to choose the apartment over a standard hotel room in an incentivized choice. However, racial discrimination disappears when the apartment is presented with an explicit trust cue, in the form of a visible top rating by other consumers (5/5 stars). This suggests that reputation-based information can counteract the tendency to discriminate against products and services provided by out-group members.

Keywords: sharing economy, discrimination, trust

Suggested Citation

Berg Nødtvedt, Katrine and Sjåstad, Hallgeir and Skard, Siv and Thorbjørnsen, Helge and Van Bavel, Jay, Racial Bias in the Sharing Economy and the Role of Trust (August 8, 2019). Available at SSRN: https://ssrn.com/abstract=3434463 or http://dx.doi.org/10.2139/ssrn.3434463

Katrine Berg Nødtvedt (Contact Author)

Norwegian School of Economics (NHH) - Department of Strategy and Management ( email )

Breiviksveien 40
N-5045 Bergen
Norway

Hallgeir Sjåstad

Norwegian School of Economics (NHH) - Department of Strategy and Management ( email )

Breiviksveien 40
N-5045 Bergen
Norway

Siv Skard

Norwegian School of Economics (NHH)

Helleveien 30
Bergen, NO-5045
Norway

Helge Thorbjørnsen

Norwegian School of Economics (NHH) - Department of Strategy and Management

Breiviksveien 40
N-5045 Bergen
Norway

Jay Van Bavel

New York University (NYU) - Department of Psychology ( email )

New York, NY 10003
United States

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