When your name matters: two field experiments on ethnic discrimination in Spain’s main online consumer-to-consumer market

Abstract

Understanding ethnic discrimination is essential for effective policymaking in multicultural societies like Spain, where the foreign-born population has grown significantly. This study examines ethnic discrimination in one of Spain’s largest online consumer-to-consumer (C2C) markets through two field experiments. The results reveal that buyers with Arabic or Chinese names face discrimination compared to those with Spanish names, but only when they bid at the listed price. In contrast, sellers do not experience similar bias, regardless of the price at which they mark their products. These findings align with the “second-moment” theory of statistical discrimination, which argues that bias arises not from prejudice against minorities or stereotypes about their abilities but from a lack of familiarity with minorities in traditional buyer roles. Sellers’ discriminatory behavior appears tied to their perception of risk: they are more likely to discriminate against minorities when aiming to minimize potential losses in favorable sales. Conversely, they show a preference for minorities when seeking to maximize gains in less-than-optimal transactions.