Tuesday archive: The economics of discrimination

From 19th November 2005:

My wife can buy cheaper car insurance than I can because she’s a woman and, fairly obviously, I am not. Is this sexual discrimination? Some people would claim that wrongful discrimination is treating somebody differently because they are a member of an identifiable group – a woman, for example, or a black person. That is a sensitive definition but not a useful one. I spent more time in my 20s pursuing girlfriends than boyfriends, and I must admit that this bias was everything to do with the fact that the girls were all members of an identifiable group.

In any case, it can be discriminatory to treat two people identically. Women are, on average, safer drivers and cheaper customers for insurance companies. If they were offered the same insurance rates as men, that would be discrimination.

Continued at timharford.com.

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