In this article a food stall owner in New Orleans decided to take a public stance and decided to charge white people two and a half times the amount he charged to minorities. He ultimately did this as an experiment to see what would happen and he explained that the price difference reflected the income disparity between African-Americans and whites in New Orleans. He explained that about 80 percent of the white customers decided to pay the inflated rates. In addition the majority of minorities declined the redistributed money that was given to them. The owner suspected that the majority paid the inflated rates because they were from higher income brackets. While the price changes were done as an experiment I am shocked people still paid the inflated prices along with the knowledge of what the owner was doing.
https://www.inc.com/chris-matyszczyk/this-business-charged-white-people-more-than-twice-as-much-as-minorities-heres-how-customers-reacted.html https://www.inc.com/chris-matyszczyk/this-business-charged-white-people-more-than-twice-as-much-as-minorities-heres-how-customers-reacted.html
1 comment:
This is an interesting experiment but I believe that it make a stronger societal argument than an economic one. The theories developed in behavioral economics would assume that the white customers would be heavily turned off of this price change due to the inequality of the prices. Other factors like guilt and social status may have driven these purchases. I would imagine that those receiving the higher price may pay in the moment but may not remain as loyal customers. I think it is important to highlight the wage disparities that exist in our country but only time will tell if the message is worth changes to long term profits.
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