White Airbnb Hosts Earn More. Can AI Shrink the Racial Gap?

White people who host rental properties on Airbnb earn significantly more per year than Black hosts, but a "race blind" pricing algorithm could help close that income gap, new research shows. Black hosts who rely on Airbnb's algorithm to set enticing prices instead of manually choosing rates increase their occupancy rates significantly, bringing their earnings more in line with the higher rental incomes of white hosts, according to a study coauthored by Shunyuan Zhang, an assistant professor in the Marketing Unit at Harvard Business School. Zhang's findings come at a critical time for the travel industry. People eager to shake off their COVID-19 cabin fever are gearing up to take vacations, raising Airbnb bookings by 52 percent last quarter from a year earlier. Harnessing artificial intelligence to reduce racial economic disparities might help more property owners benefit from pent-up lodging demand.