Question

Airbnb, a popular home-sharing website founded in San Francisco in 2008, offers millions of homes for
short-term rental in more than 190 countries. This company has revolutionized the sharing economy in
the same way that ride-sharing services such as Uber and Lyft have, and according to the company, the
site’s drive to connect hosts and potential renters has been able to contribute to the quality of life of
both homeowners and travelers. According to Airbnb’s press releases and information campaigns, their
services can reduce housing costs for travelers on a budget and can provide unique experiences for
adventurous travelers who wish to have the flexibility to experience a city like a local. The organization
also claims that most of its users are homeowners looking to supplement their incomes by renting out
rooms in their homes or by occasionally renting out their whole homes. According to a statement, most
of the listings on the site are rented out fewer than 50 nights per year.

Despite the carefully crafted messages Airbnb has presented to the public, in 2016 the company came
under intense scrutiny when independent analyses by researchers and journalists revealed something
startling: While some Airbnb hosts did in fact use the services only occasionally, a significant number of
hosts were using the services as though they were hotels. These hosts purchased a large number of
properties and continuously rented them, a practice that affected the availability of affordable housing in
cities and, because these hosts were not officially registered as hoteliers, made it possible for Airbnb
hosts to avoid paying the taxes and abiding by the laws that hotels are subject to.

Title II of the Civil Rights Act of 1964 mandates that hotels and other public accommodations must not
discriminate based on race, national origin, sex, or religion, and Title VIII of the Civil Rights Act of 1968
(also known as the Fair Housing Act [FHA]) prohibits discrimination specifically in housing. However,
Airbnb’s unique structure allows it to circumvent those laws. The company also claims that while it
encourages hosts to comply with local and federal laws, it is absolved from responsibility if any of its
hosts break these laws. In 2017, researcher Ben Edelman conducted a field experiment and found that
Airbnb users looking to rent homes were 16% less likely to have their requests to book accepted if they
had traditionally African American sounding names like Tamika, Darnell, and Rasheed.

These findings, coupled with a viral social media campaign, #AirbnbWhileBlack, in which users claimed
they were denied housing requests based on their race, prompted the state of California’s Department
of Fair Employment and Housing (DFEH) to file a complaint against the company. In an effort to resolve the complaint, Airbnb reported banning any hosts who were found to have engaged in discriminatory
practices, and they hired former U.S. Attorney General Eric Holder and former ACLU official Laura
Murphy to investigate any claims of discrimination within the company.31 In 2016, Airbnb released a
statement outlining changes to company practices and policies to combat discrimination, and while they
initially resisted demands by the DFEH to conduct an audit of their practices, the company eventually
agreed to an audit of roughly 6,000 of the hosts in California who have the highest volume of properties
listed on the site.

Sources: AirBnB Press Room, accessed December 24, 2018, https://press.atairbnb.com/about-us/;
“Airbnb's data shows that Airbnb helps the middle class. But does it?”, The Guardian, accessed December
23, 2018, https://www.theguardian.com/technology/2016/jul/27/airbnb-panel-democratic-nationalconvention-
survey ; and Quittner, Jeremy, “Airbnb and Discrimination: Why It’s All So Confusing”,
Fortune, June 23, 2016, http://fortune.com/2016/06/23/airbnb-discrimination-laws/ (Links to an external site.).

Discussion Questions
1. What are some efforts companies in the sharing economy can take before problems of
discrimination threaten to disrupt operations?
2. Should Airbnb be held responsible for discriminatory actions of its hosts?

Answer 1

1) Before issues of discrimination take steps to disturb tasks organizations should build up a far reaching rules for its hosts and specialist organizations in order to guarantee that all hosts and specialist organizations are in the same spot with respect to offering administrations in a deliberate way to all clients independent of their race, religion, nationality and so forth.

While coordinated effort and nearness of a democratized approach are the sign of sharing economy organizations that produce income and are noteworthy piece of the sharing economy should create far reaching structure and rule that will guarantee that their plan of action is comprehensive and request of all clients in the objective market is met in an unmistakable and deliberate way. There is a need to build up a comprehensive model.

Furthermore organizations in a common economy should attempt satisfactory due determination and furthermore give adequate oversight just as preparing to their colleagues. All these will guarantee responsibility of colleagues, hosts and specialist co-ops and security and regard of clients will likewise be considered as an essential piece of the plan of action.

As guidelines are built up all irregularities with respect to this will likewise decrease and in the long run stop to exist.

2) No, Airbnb should not be considered answerable for discriminatory activities of its hosts. This is on the grounds that despite the fact that Airbnb goes about as a specialist for its hosts it has basically no chance to identify discriminatory perspectives among the hosts.

It has little capacity to forestall discrimination before it happens. According to the arrangements of law an operator isn't liable for the offense of the hosts being served via Airbnb.

Having said this Airbnb has obtained adequate size and scale to guarantee that the hosts that it serves are working under a uniform arrangement or facilitating rules and that no host will be urged to take part in any type of discrimination.

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