Discrimination by Customers

Abstract

Customers discriminate by race and gender, with considerable negative consequences for female and minority workers and business owners. Yet anti-discrimination laws apply only to discrimination by firms, not by customers. We examine efficacy and privacy reasons for why this may be so, as well as changing features of the market that, by blurring the line between firms and customers, make current law increasingly irrelevant. We conclude that, while there are reasons to be cautious about regulating customer behavior, those reasons do not justify acceding to customer discrimination altogether. To open a discussion of the regulatory options that take account of the most significant concerns, we offer a modest proposal. This proposal does not create a legal obligation on the part of customers themselves, but rather requires firms that already have nondiscrimination obligations to do more to reduce the occurrence, and consequences, of discrimination by customers.