Ethnic Discrimination in London’s Housing Market – Are Bangladeshi women worse off applying for housing compared to White women?

Abstract

This study investigates ethnic discrimination for sublets in London’s rental housing market. By applying an experimental design, four female fictitious characters were created to apply for housing advertisements on the website Gumtree. The characters signaled two different ethnicities: Bangladeshi and White, all were females and had similar occupations in the applications. The applications were sent out to 399 landlords in London and randomly constructed into pairs of one Bangladeshi and one White applicant. The results were analyzed based on taste-based and statistical discrimination theory; however, drawing conclusions from these theories were challenging since limited information about the landlords was observable. Surprisingly, Bangladeshi applicants received more positive callbacks than Whites, nonetheless the results for the probability of receiving a callback depending on ethnicity was inconclusive. The study concludes that no inferences on ethnic discrimination between Bangladeshis and Whites could be made, but the gender and ethnicity of the landlords played a significant role for determining the rate of callbacks overall. The Bangladeshi applicant had 11.2 percentage points lower probability of receiving a positive callback when they were sent second to the White applicant, opposed to vice versa. This could suggest some differential treatment between the ethnic groups that was not detected with this experimental design.