Small Pictures, Big Biases: The Adverse Effect of an Airbnb Anti-Discrimination Policy
Abstract:
Using scraped data from the Airbnb platform in New York City alongside state-of-the-art Vision Transformers models for image classification, this paper investigates the existence and extent of ethnic discrimination in the Airbnb platform and the impact of a policy to reduce this bias. First, we show that Black hosts have a 7.2 percentage points lower occupancy rate than their White counterparts despite no differences in pricing. For Asian and Hispanic hosts, the difference from Whites is small and mostly insignificant for both occupancy rate and prices. Second, using difference-in-differences and event studies approaches, we show that the 2018 Airbnb anti-discrimination policy, which reduced the size of users’ profile pictures on the platform, increased the Black-White occupancy rate disparity by about 4 percentage points. As a reaction to the negative impact of the new policy, Black hosts increased the number of basic amenities in their listings, but they did not adjust the prices. We argue that a potential mechanism for the increase in Black-White disparity stems from the increasing guests’ uncertainty in discerning facial features that positively correlate with occupancy rates from the smaller profile pictures. As a result, guests focus more on skin color.
Language: English
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