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Ethnic discrimination and signals of trustworthiness in an online market: Evidence from two field experiments

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  • Wojtek Przepiorka

    (University of Oxford)

Abstract

Results from two field experiments which were designed to identify possible ethnic discrimination on a German internet auction platform are discussed. A first set of results is produced by a secondary analysis of an earlier experiment. The second experiment additionally tests whether costly signals can help to overcome trust problems between buyers and sellers in online markets. The evidence is rather mixed with respect to ethnic discrimination, and it does not support the signaling hypothesis.

Suggested Citation

  • Wojtek Przepiorka, 2012. "Ethnic discrimination and signals of trustworthiness in an online market: Evidence from two field experiments," Discussion Papers 2012002, University of Oxford, Nuffield College.
    • Handle: RePEc:cex:dpaper:2012002
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    File URL: http://cess-wb.nuff.ox.ac.uk/documents/DP2012/CESS_DP2012_002.pdf
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    References listed on IDEAS

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    1. Levitt, Steven D, 2004. "Testing Theories of Discrimination: Evidence from Weakest Link," Journal of Law and Economics, University of Chicago Press, vol. 47(2), pages 431-452, October.
    2. Patrick Bajari & Ali Hortaçsu, 2004. "Economic Insights from Internet Auctions," Journal of Economic Literature, American Economic Association, vol. 42(2), pages 457-486, June.
    3. Jennifer L. Doleac & Luke C.D. Stein, 2013. "The Visible Hand: Race and Online Market Outcomes," Economic Journal, Royal Economic Society, vol. 123(11), pages 469-492, November.
    4. P. A. Riach & J. Rich, 2002. "Field Experiments of Discrimination in the Market Place," Economic Journal, Royal Economic Society, vol. 112(483), pages 480-518, November.
    5. Paul Resnick & Richard Zeckhauser & John Swanson & Kate Lockwood, 2006. "The value of reputation on eBay: A controlled experiment," Experimental Economics, Springer;Economic Science Association, vol. 9(2), pages 79-101, June.
    6. Przepiorka, Wojtek, 2013. "Buyers pay for and sellers invest in a good reputation: More evidence from eBay," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 42(C), pages 31-42.
    7. Werner Raub, 2004. "Hostage Posting as a Mechanism of Trust," Rationality and Society, , vol. 16(3), pages 319-365, August.
    8. Nelson, Philip, 1974. "Advertising as Information," Journal of Political Economy, University of Chicago Press, vol. 82(4), pages 729-754, July/Aug..
    9. Phelps, Edmund S, 1972. "The Statistical Theory of Racism and Sexism," American Economic Review, American Economic Association, vol. 62(4), pages 659-661, September.
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    11. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
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    Cited by:

    1. Tjaden, Jasper Dag & Schwemmer, Carsten & Khadjavi, Menusch, 2018. "Ride with Me - Ethnic Discrimination, Social Markets and the Sharing Economy," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 34(4), pages 418-432.
    2. von Essen, Emma & Karlsson, Jonas Karlsson, 2013. "A matter of transient anonymity: Discrimination by gender and foreignness in online auctions," Research Papers in Economics 2013:6, Stockholm University, Department of Economics.
    3. Przepiorka, Wojtek, 2013. "Buyers pay for and sellers invest in a good reputation: More evidence from eBay," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 42(C), pages 31-42.
    4. Tjaden, Jasper Dag & Schwemmer, Carsten & Khadjavi, Menusch, 2017. "Ride with me: Ethnic discrimination in social markets," Kiel Working Papers 2087, Kiel Institute for the World Economy (IfW Kiel).

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    More about this item

    Keywords

    Discrimination; Costly signaling; Trust; Online market; Field experiment;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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