African Americans are more likely to wait longer to be picked up or have ride share drivers cancel and not pick them up at all.
The new study, published in the National Bureau of Economic Research, reports on experiences in Boston and Seattle and does not focus on the practices of ride-share services as a whole but only the actions of individual drivers.
“Frankly, that discrimination exists was not surprising after all the evidence of discrimination elsewhere,” says Stephen Zoepf, executive director of the Center for Automotive Research at Stanford University. “It essentially confirmed our suspicions more than anything else. I think that the magnitude of the discrimination and the cancellation rates was surprising to me.”
Third Point's Dan Loeb discusses their new positions in a letter to investor reviewed by ValueWalk. Stay tuned for more coverage. Loeb notes some new purchases as follows: Third Point’s investment in Grab is an excellent example of our ability to “lifecycle invest” by being a thought and financial partner from growth capital stages to Read More
In the first part of the study, which was carried out in Seattle by Don MacKenzie and Yanbo Ge of the University of Washington, eight research assistants—two African-American women, two African-American men, two white women, and two white men—hailed rides from designated areas at specific times of day.
Of the 581 app-hailing trips recorded, the African-American travelers waited on average 20 percent longer than white travelers to have their ride accepted on Lyft or UberX. It also took about 30 percent longer for African-American travelers to be picked up than white travelers when they used UberX. There were no significant differences in wait times using Lyft.
Ride-Share – Names and cancellations
Zoepf led a second arm of the research in Boston, which started when he was a postdoctoral fellow at MIT working with coauthor Christopher R. Knittel. In this experiment, researchers created two profiles for each traveler, one with a stereotypically African-American name and another with a stereotypically white name. The travelers involved could pass for either race in physical appearance. In addition to the timing data, the researchers also recorded ride cancellations for the 911 trips recorded.
“…there are steps these services can voluntarily take to minimize service bias against minorities.”
In Boston, the team found that travelers with African-American names faced double the cancellation rate on UberX compared with travelers with white-sounding names.
Areas with low population density showed a particularly dramatic disparity, with men using African-American names experiencing more than three times as many cancellations while using UberX as men using white names. Overall, approximately 15 percent of their rides were canceled. This may indicate that drivers who chose to work in those areas are more likely to be biased against African Americans.
Women ride longer
Lyft did not have the same evidence of cancelation on African-American travelers, but the this could be due to the fact that Lyft drivers see a first name as soon as a ride is available for selection, whereas Uber drivers see the first name only after they’ve accepted a ride.
Although not the focus of the study, the researchers also found a significant difference in the trip data of female versus male travelers in Boston. On average, female travelers were driven 5 percent further than males, given the same start and finish location. Anecdotal evidence from the female passengers led the authors to surmise that this may have resulted from a combination of flirtation and profiteering.
“The patterns of discrimination were quite clear and consistent in both cities—and one can only assume it’s happening all across the country in other markets,” says Knittel, who is a professor at the MIT Sloan School of Management. “The study has found major areas of racial discrimination within this new industry. It’s quite concerning.”
Ride-Share – Individuals are doing the discriminating
App-based ride-sharing services, while innovative in other ways, seem to fall in line with an established trend of racial discrimination seen in the broader ride-hailing industry.
“The fundamental issue to me is whether ride-sharing services are really fixing historical issues of discrimination that exist with taxi cabs,” Zoepf says. “That’s one of the things the Seattle portion of the study focused on. They showed there is substantial discrimination in the taxi system.”
Additional work by the University of Washington researchers found that taxi drivers in Seattle passed by African-American customers more often than white customers.
A crucial aspect of this research is that all the findings focus on the behavior of the ride-share drivers, not the companies themselves.
“I don’t think that this shows discrimination on the part of the operators,” he says. “This is not Uber discriminating or Lyft discriminating. This is a reflection of the decisions of individuals in society.”
Ride-Share – No easy solutions
This research does not describe bias on the part of these companies as a whole, but the most effective solutions to rider discrimination might originate from large-scale changes to the way the services operate, the authors write.
“Though completely eliminating discrimination is unfortunately impossible, there are steps these services can voluntarily take to minimize service bias against minorities,” says MacKenzie, who is an assistant professor within the civil and environmental engineering department at the University of Washington. “We hope the companies take positive steps to address these problems.”
In the paper, the researchers offer several suggestions, including using a passcode to identify passengers instead of a name, more severe consequences for cancellations (including situations where drivers sit in place to prompt the traveler to cancel), audits from outside partners to analyze driver behavior and fixed-price fares to discourage extended trips with female travelers, a practice which Uber has begun implementing.
The solutions, however, are far from simple. “It’s one of those situation where you step on the carpet here and bubbles pop up over here,” Zoepf says.
For example, this research showed no evidence of a difference in star rating for the various passengers. This may be an encouraging result but it could originate from drivers acting on their biases before a ride even starts. Counterintuitive scenarios like this may cause actions designed to reduce discrimination to backfire.
“Potentially, you could envision a situation where people who have a gender or racial bias in their heart would leave lower feedback levels for a certain gender or race,” Zoepf says. “Over time that would affect a person’s ability to do business on this platform at all, with any driver.”
The work is preliminary as it only takes into account about 1,500 rides in two cities out of the roughly one billion rides Uber and Lyft have completed in many countries. What the results do indicate clearly is the need for more comprehensive analysis of these services and how they reflect society, Zoepf says.
“Transportation is a very complex social system. It’s the basis of economic opportunity, it’s the basis of social interaction, it’s the basis of many fundamental things that we do in life. It’s very important to make this system equitable.”
The University of Washington Royalty Research Fund funded the study.
Source: Stanford University
Original Study DOI: 10.3386/w22776
Article by Taylor Kubota-Stanford