Mitigating implicit racial bias in tipping: when direct and indirect experience matters
Digital service platforms such as Uber, Airbnb, and Didi are increasingly adding customer ratings and tipping functionality to their apps. Although these changes benefit customers, they also negatively impact service workers and especially exacerbate minority workers’ vulnerabilities. Some platforms have made efforts to manage discrimination, yet the issue remains rampant.
The literature has examined the main effect of race on service outcomes, which can be attributed to implicit racial biases, an unintentional and unconscious form of discrimination. However, most studies have only focused on service interactions with limited length and direct experience. Moreover, limited empirical understanding of the issue and the increasing relevance of customer ratings on digital service platforms call for further investigation of conditions that impact the negative effects derived from frontline employees’ race.
This study fills such gap by analyzing the role of direct and indirect experience in tipping frontline service workers from a minority background. Drawing on expectancy disconfirmation theory, this study seeks to understand how consumers’ tipping behavior depends on whether stereotype-based expectations (of African-American versus Caucasian service workers) are confirmed (or disconfirmed) by the evidence gained through both direct (interaction length) and indirect experience (customer ratings).
Method and sample
A 2 (race: African-American versus Caucasian) x 2 (direct experience: limited, 4 minute versus extensive, 60 minute Uber trip) x 3 (indirect experience: absent versus positive versus negative) experiment was conducted in a ride-sharing context. Three scenarios were used to formulate the hypotheses: scenario 1 describes a consumer exposed to extensive direct experience and no indirect experience; scenario 2 occurs when a consumer has limited direct experience but is exposed to either negative or positive indirect experience; scenario 3 describes consumers exposed to both extensive direct experience and indirect experience.
A sample of 360 US Amazon M-Turk respondents were presented with a scenario in which they required an Uber ride to travel to a friend’s house with “Dave” as their driver and were randomly assigned to one of the conditions. Three versions of “African-American Dave” and three versions of “Caucasian Dave” were used in the study to minimise bias stemming from appearance, such as perceived attractiveness. Tipping was measured with the question: “How much would you be willing to tip Dave?”, as percentages of trip fare on an eight-point scale.
Key findings
- In scenario 1, when individual consumers have extended direct experience (i.e. longer service interaction) and no indirect experience information (i.e. no customer ratings), consumers tend to tip African-American service providers more than their Caucasian counterparts.
- When individual consumers have limited direct experience and are exposed to indirect experience information (scenario 2), tipping amounts were found to be higher for African-American than Caucasian service providers with positive ratings, but no significant difference was found for negative ratings.
- Finally, when consumers have extensive direct experience and are exposed to indirect experience information, either positive or negative (scenario 3), no difference was found in tips between the two conditions.
Recommendations
These findings have managerial implications for the current tipping practices as well as minority service workers themselves. Firstly, the study advocates for tips being pooled and distributed equally across service workers or a set tip percentage being set for customers who choose to tip, which can be facilitated with the digitalization of tipping. Secondly, customer ratings should be leveraged to promote equality by making them more salient when service interactions are likely to be longer. Third, service providers who promote indirect experience such as customer ratings should encourage extended service interactions with individual customers where possible across all service workers regardless of race, for example, by allowing customers to book round trips with the same service provider to extend their service interaction.
For minority service workers with positive customer ratings, engaging in shorter service interactions such as inner-city rides can help maximise tips. In service encounters that do not feature customer ratings, minority service workers should instead sign up for extended customer interactions such as a trip from the airport. By implementing these, minority service workers can control the work environment in a way that maximizes their tips, until wider systemic changes are actioned. Overall, these recommendations address the power imbalance between the consumer and minority service employee discussed in critical theory.
Researcher
More information
The research article is also available on eprints.