Recent research suggests that racial bias can have a measurable impact on internet-based, sharing services like Airbnb. For example, a 2014 study from the Harvard Business School revealed that non-black Airbnb hosts can charge 12 percent more than black hosts for a similar property. To curb discriminatory practices, the study authors recommend concealing basic information, such as photos and names, until a transaction is complete. However, research by Jun Li, an assistant professor at the Ross School of Business, and her associates indicates rental decisions on platforms such as Airbnb are based on racial preferences only when not enough information is available. When more information is shared, specifically through peer reviews, discriminatory practices are reduced or even eliminated. “We recommend platforms take advantage of the online reputation system to fight discrimination. This includes creating and maintaining an easy-to-use online review system, as well as encouraging users to write reviews after transactions,” Li said. “Eventually, sharing-economy platforms have to figure how to better signal user quality; nevertheless, whatever they do, concealing information will not help.”
