Online Shoppers Biased Against Sellers Who Are Black Or Have Tattoos

When it comes to online shopping, consumers are more likely to purchase items advertised by a white person than a black person or someone with tattoos.

In a recent study released by the Economic Journal of the Royal Economic Society, researchers conducted an experiment from March 2009 to March 2010 using advertisements selling silver, 8GB iPod nanos on Craigslist. Photographs along with the 1,200 advertisements featured either the hand of a white person, a white hand with tattoos on the wrist, or a black hand. The online promotions were posted in more than 300 locations across the U.S. varying in size and population.

Researchers then looked for racial biases along the lines of which hand sold the most iPods. They found the white, tattoo-free hand sold the most iPods. Black sellers got 13 percent fewer responses from consumers and 18 percent fewer offers. When a black seller did get an offer, the amount was 11 to 12 percent lower, Live Science reported. Results for the white, tattooed hand were similar.

"We were really struck to find as much racial discrimination as we did," University of Virginia professor Jennifer Doleac, a co-author of the study, told Live Science.

The study also shows that consumers are less likely to trust advertisements with the black seller. Buyers were 56 percent more likely to oppose a long-distance payment, 44 percent less likely to allow a mail delivery and 17 percent less likely to provide their names.

Black sellers also did poorly in locations where the property-crime rate was high. This suggests in those areas there was "statistical-discrimination," meaning shoppers were more concerned about the potential theft of the iPod then the seller's race.

"Buyers might not be trying to avoid buying from black sellers, per se, but are trying to avoid something else that they think is correlated with race: traveling to a dangerous neighborhood, buying stolen goods, etc," Doleac told BusinessNewsDaily. "This suggests that providing more information (e.g. central meeting places, purchase guarantees) could reduce racial disparities in outcomes."