The effects of information and competition on racial discrimination: Evidence from a field experiment

John M. Nunley, Mark F. Owens, R. Stephen Howard

Research output: Contribution to journalArticle

14 Citations (Scopus)

Abstract

We study racial discrimination by simultaneously selling identical products on eBay in pairs of auctions posted under different racially identifying names. We detect significant price differences, which are indicative of in-group biases. White names receive higher prices for distinctively white products, and black names receive higher prices for distinctively black products. But price differences only emerge for sellers who have low eBay feedback scores in less competitive markets. Because the price differences dissipate as sellers accumulate credible reputations, the patterns in the data are indicative of statistical discrimination. Overall, the results suggest that mechanisms designed to reduce informational asymmetries and increased competition are both effective at reducing discrimination in online auctions.

Original languageEnglish (US)
Pages (from-to)670-679
Number of pages10
JournalJournal of Economic Behavior and Organization
Volume80
Issue number3
DOIs
StatePublished - Dec 1 2011

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Racial discrimination
Field experiment
eBay
Seller
Discrimination
Informational asymmetry
Online auctions
Statistical discrimination
Auctions
Competitive market

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management

Cite this

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The effects of information and competition on racial discrimination : Evidence from a field experiment. / Nunley, John M.; Owens, Mark F.; Howard, R. Stephen.

In: Journal of Economic Behavior and Organization, Vol. 80, No. 3, 01.12.2011, p. 670-679.

Research output: Contribution to journalArticle

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