Ethnic Discrimination in the German Housing Market

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This project is conducted in cooperation with Andreas Horr (University of Mannheim) and Clemens Kroneberg (University of Cologne) and the data collection was financed by the Mannheim Centre for European Social Research (MZES) at the University of Mannheim. We use a telephone audit study to measure ethnic discrimination in the housing market of a southern German metropolitan area. Ethnic discrimination on the housing market has long been seen as a cause for social inequality and residential segregation. For Germany, little research has been done that examines whether ethnic discrimination on the housing market exists and what the mechanisms behind discrimination are. We study ethnic discrimination in the rental housing market of a German metropolitan area using a telephone audit design: randomly assigned testers called landlords who had advertised apartments for rent. While earlier field experiments focused on assessing the degree of discrimination by varying the ethnicity of testers, we also try to identify the mechanisms behind landlords’ behavior. To distinguish between information- and taste-based discrimination, we added two additional experimental variations: (1) whether or not at the beginning of the call testers disclosed information on having a stable job, and (2) whether or not testers with an ethnic minority (Turkish) name spoke with an accent. Using fixed-effects models to account for unobserved heterogeneity in apartments and landlords, we find no significant discrimination against callers with Turkish names in invitations for apartment viewings. However, callers with both a Turkish name and a Turkish accent were invited significantly less often. While a positive job signal compensated parts of this disadvantage, the invitation rate for ethnic speakers with an accent and with a job signal is still significantly lower than the rate for ethnic speakers without an accent who did not signal a stable income. Based on these findings, we conclude that information-based (statistical) discrimination seems to be the main reason migrants receive fewer invitations to see, respectively rent apartments.

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