RACIAL DISCRIMINATION AGAINST PEOPLE OF COLOR DURING BOOKING OF AIRBNBS CMN

RACIAL DISCRIMINATION AGAINST PEOPLE OF COLOR DURING BOOKING OF AIRBNBS CMN

Airbnb is a sharing economy enterprise that was founded in 2008 to give travelers a local experience and emergence into the community during their trips by allowing locals to provide accommodation in their homes rather than booking hotels. It also empowers people around the world by allowing them to become hospitality entrepreneurs, therefore benefitting all shareholders – the guests, hosts, the airbnb organization as well as the involved communities.

Despite Airbnb being a platform for multiple stakeholders to benefit from, there have been several ethical and social concerns surrounding complaints received from people of color reporting multiple instances of perceived and/or racial discrimination and seclusion while booking or utilizing the company’s services. This has led to the filing of multiple law suits against the organization as well as individual hosts with the former attempting to make reforms in its policies to demonstrate its support for diversity and inclusion.

This case study aims to provide insight into the ethical issues surrounding the perceived discrimination and/or discrimination faced by people of color (POC) while making bookings for Airbnb. It is significant because it is a level of institutional/organizational discrimination that transcends the norm as it has now moved past regular business interactions and into the technological sphere found online where it is done subtly through refusing services to individuals based on their names and skin color. On the other hand, the properties involved are privately owned and the owners may be within their rights to exercise who they feel comfortable allowing into their home. This paper will further contribute to existing knowledge by deciphering the line between exercising one’s individual rights and discriminatory behavior as well as suggesting actions that can be pursued to effectively manage the issue.

Therefore, my research will answer the following questions;

• What perspectives can be used to explain the ethical concerns surrounding the services provided by Airbnb to people of color?
• Are incidents of Airbnb hosts refusing particular individuals access to their homes ethical violations or rights being exercised?
• What actions can best be utilized to mitigate perceived discrimination/discrimination while accessing the Airbnb services?

THEORETICAL FRAMEWORK

A theory that can be used to explain the occurrence of discrimination online is the social identity theory. It argues that people voluntarily or involuntarily divide themselves into social groups in which they share similarities. Doing so creates in – groups and out – groups which consequently shape the ways in which individuals interact with one another, whereby there is in – group favoritism and discrimination against the out – group. In the case of our study, people may classify themselves in terms of characteristics like race and show favoritism towards members sharing the same. This is due to the fact that members with similar characteristics find that interactions among themselves bring about more desirable outcomes in comparison to interactions with those that are different. In the long run, this can cause power disparities where members of the out – group experience disadvantage, less opportunity and social isolation (Choi, 2016).

LITERATURE REVIEW

According to Karlsson, Kemperman and Dolnicar (2016), Airbnb has changed the format of traditional business transactions. Now, to access services, the guest must market themselves through pictures and a short personal statement so as to receive acceptance for a booking and are essentially at the mercy of the host. This part is crucial as it is the guest’s mandate to foster enough trust through their profile to convince the host to let them into their home but at the same time, it increases the risk for discrimination.

This brings into question digital discrimination as introduced by Cheng and Foley (2007). It refers to “a range of circumstances in which a person or group is treated less favorably than another person or group based on their background and/or certain personal characteristics with regards to Internet” (p. 95). They argue that because hosts have access to the personal details of a potential guest such as their pictures, religious affiliation and language, they are able to pick and choose who to host based on their personal biases.

Ladegaard (2018) conducted a research project on Airbnb discrimination where he uncovered host bias by asking them about their guest preferences. Many of the hosts preferred guests that shared similar characteristics with them. However, they also said they wanted an element of ‘otherness’ so as to give them a different world experience. This paradox of wanting similarities and differences was a point of interest that illustrated the preference for something “comfortably exotic” (p. 382), where in the hosts’ experience, was hosting English speaking Europeans who were similar to them in many aspects but had differences that were not too different.

Edelman, Luca and Svirsky (2016) found that bookings made by individuals with African American sounding names are 16% less likely to be accepted than those with stereotypically Caucasian names. It is seen more often among hosts that have never had African American guests. Moreover, despite the presence of anti discriminatory laws based on race for accommodation based business owners, some legal scholars believe that such laws apply only to large buildings and not to the smaller airbnb landlords.

McLaughlin (2018) argues that the Fair Housing Act is lagging behind in updating laws which manage discrimination with technology based accommodation such as Airbnb. This is due to a clause known as Mrs. Murphy exemption which “shields small owner-occupied apartments and homes from liability under the FHA. So long as a homeowner lives in the home or apartment unit she rents out and the building contains four or fewer rental units, she is free to racially discriminate against potential renters” (p.154 ).

Continued discrimination complaints led to the emergence of one of the biggest movements against the issue, namely, #airbnbwhileblack which was begun by Quirtina Crittenden, an African American business consultant living in Chicago. She took to social media to express how her booking requests were often rejected under suspicious circumstances such as hosts claiming they were booked only to later discover they were actually vacant. This sparked debates on the social media platform twitter when several other individuals shared similar stories, some claiming that they later made fake accounts with stereotypically Caucasian sounding names or using fake pictures only to be accepted while their real profiles were rejected (McLaughlin, 2018). This in turn led to multiple law suits filed against both the organization and the individual hosts.

Airbnb responded by making a public stand against discrimination and upgrading their policies in line with the same. An anti – discriminatory report submitted to Airbnb detailed challenges faced by various shareholders due to discrimination and proposed solutions and policies to manage the same. Some of these policy changes include; an Airbnb Community Commitment that all must sign before using the site, a permanent team designated to promote diversity and fight any discriminatory cases, reducing the prominence of photos on individuals’ profiles among others (Murphy, 2016).

Despite the backlash it faces due to complaints of discrimination, Airbnb continues to grow at rapid rates. This has led to the disruption of the traditional hotel industry. For instance, Texas alone suffers 0.05% in quarterly revenue for each one percent increase in Airbnb reservations (Ert, Fleischer and Magen, 2016).

METHOD

This study uses a systematic review to identify literature on racial discrimination against people of color during Airbnb bookings. The study is limited to the last ten years since the creation of Airbnb. However all of the articles used are dated between 2016 and 2018.

The systematic review includes peer reviewed scholarly literature as well as a few non-scholarly online news articles.

DATA COLLECTION

Data collection procedures were done by sourcing articles from Scopus, PsycInfo and Google Scholar. The search parameters included the keywords: airbnb, discrimination and ethics, which were applied to all the databases. Furthermore, I chose to limit the results to peer reviewed articles alone. This did not apply to Google Scholar whereby only the keywords were inputted and searched, which then resulted in the non scholarly online news articles.

The number of hits in the systematic literature search of the three databases is shown in Table 1 below. In total 8 articles were selected for analysis after the elimination of the duplicates found when the three database searches were merged.

Table 1

The most discussed constructs in the articles regarding the Airbnb case study are racial discrimination and ethics and morals. Racial discrimination has been addressed in 7 of the articles while ethics and morals have been addressed in 3 and the other constructs twice respectively.

Foley and Cheng (2016) hold Airbnb responsible for the discrimination that occurs on Airbnb because of the way in which its operating system is set up. As long as users can see each others’ pictures, then discrimination especially along racial lines will surely continue.

It is therefore the most pertinent issue because one cannot use the website without gaining access to other users pictures which then automatically creates bias as individuals will judge based on their personal preferences.

Ethics and morals was the second most addressed construct in the case study. It was important because most issues that discuss discrimination go hand in hand with morals and ethics. In this case, it is also tied in with the law due to the debate about the Mrs. Murphy exemption which creates a loophole for small Airbnb business owners to have a right to exercise who they will allow onto their property.

As claims of racial discrimination on Airbnb grow, so does the perception that the Mrs. Murphy exemption protects both Airbnb and its hosts from responsibility under the Fair Housing Act and allows hosts to legally discriminate against potential guests on the basis of race (McLaughlin 2018).

Commercial constructs are seen whereby a host incurs a cost when they reject a guest due to bias leading to the unit remaining vacant.  According to the study conducted by Edelman et al (2016), it was difficult for hosts to find a replacement guest once they rejected an individual based on bias. The final results however proved that hosts incur a real cost by discriminating. The median host who rejects a guest because of race is turning down between $65 and $100 of revenue.

The non – traditional business protocol is characterized by a phenomenon known as disruptive innovations. It is characterized by “initially failing to meet the requirements of current customers because they offer a different set of performance attributes”. However, they eventually grow and outperform the traditional businesses (Karlsson et al, 2016). In addition to that is the phenomenon whereby guests are forced to market themselves so as to receive services which goes against the traditional model of the service provider marketing themselves to the potential customers.

Ert et al (2016) have illustrated the importance of trust as customers of sharing economy services like Airbnb are exposed to further risks other than just financial loss. Trust is therefore essential to give a sense of safety. In regards to Airbnb hosts that may face difficulty getting customers to book, online reviews play a big role in building trust.

TECHNOETHICS CODING TABLE

Table 3

SUMMARY

The growth of Airbnb has illustrated the big changes that business is undergoing due to technology. Whereas in the past, vendors marketed themselves so as to sell as much of their product as possible to facilitate profit, today individuals are required to market themselves so as to prove eligible to receive services (Karlsson et al, 2016). This marketing is done by providing identification information and pictures which helps to build trust and encourage hosts to accept potential guests’ bookings. Contrary to its intention, it then provides a basis for discrimination (Ert et al, 2016) whereby we have seen that African-American names are 16% less likely to be accepted relative to identical guests with distinctively Caucasian names (Edelman et al, 2016) and that hosts prefer guests to whom they are comfortable because of their common traits such as race and language (Ladegaard, 2018).

Strict laws are required to mitigate discrimination among users. However, Mrs. Murphy’s exemption has provided a loophole in the system and therefore allows for individuals owning small accommodations to be exempt from being answerable to rejecting bookings from particular individuals as they are exercising their rights (McLaughlin, 2018).

In the meantime, Airbnb is busy implementing new policies and strategies to effectively manage discrimination on their platform (Murphy, 2016).

CONCLUSION

This study shows us that peer to peer business networks such as Airbnb still have a lot of social and ethical concerns. As a relatively new player in an ever changing environment, Airbnb has not yet established efficient laws and regulations to relieve those concerns. Furthermore, a system update is necessary so as to withhold information that can propagate bias, but share enough to encourage trust and security.

LIMITATIONS

The study has accepted Mrs. Murphy’s exemption as a basis not to hold hosts living in the house liable for refusing particular guests from accessing their property. However, thus clause is found under the 1968 Fair Housing Act which may not be relevant to the situation due to the technological advancements that have occurred since that time. Furthermore, there are no conclusive strategies or policies that have been adopted to guarantee effective mitigation of discrimination, while at the same time providing enough information to promote trust.

In addition to this, all the information used in this project is secondary data. No surveys or interviews were conducted to capture raw or firsthand knowledge from the Airbnb users.

Future research could contribute to more insight on the ethical issues surrounding discrimination while using Airbnb or other peer to peer businesses by focusing on finding systemic solutions to share future guests’ details without putting them at risk to face discrimination. This also goes hand in hand with identifying air tight laws, new or otherwise, unlike the 1968 Fair Housing Act that can protect users from discriminatory practices while using peer to peer business platforms.

REFERENCES

Cheng, M., & Foley, C. (2018). The sharing economy and digital discrimination: The case of Airbnb. International Journal of Hospitality Management,70, 95-98. doi:10.1016/j.ijhm.2017.11.002

Choi, S. (2016). Workforce Diversity and Job Satisfaction of the Majority and the Minority. Review of Public Personnel Administration,37(1), 84-107. doi:10.1177/0734371×15623617

Comment #Airbnbwhileblack: Repealing The Fair Housing Act … (n.d.). Retrieved from http://wisconsinlawreview.org/wp-content/uploads/2018/04/McLaughlin-Camera-Ready.pdf

Edelman, B. G., Luca, M., & Svirsky, D. (2015). Racial Discrimination in the Sharing Economy: Evidence from a Field Experiment. SSRN Electronic Journal. doi:10.2139/ssrn.2701902

Ert, E., Fleischer, A., & Magen, N. (2015). Trust and Reputation in the Sharing Economy: The Role of Personal Photos on Airbnb. SSRN Electronic Journal. doi:10.2139/ssrn.2624181

Karlsson, L., Kemperman, A., & Dolnicar, S. (2017). May I sleep in your bed? Getting permission to book. Annals of Tourism Research,62, 1-12. doi:10.1016/j.annals.2016.10.002

Ladegaard, I. (2018). Hosting the comfortably exotic: Cosmopolitan aspirations in the sharing economy. The Sociological Review,66(2), 381-400. doi:10.1177/0038026118758538

Murphy, L. W. (2016). Airbnb’s Work to Fight Discrimination and Build Inclusion. A Report Submitted to Airbnb(Rep.). Retrieved from https://pamplinmedia.com/documents/artdocs/00003571748198.pdf.