Price Discrimination? Racial Discrimination?

From a reader named Philip Mulder comes this photograph:

Philip says this is a hair-cutting joint in Washington, D.C. As you can see, it offers a 50% discount if your name is — in this case — Amanda, Rachel, Katie, Peter, Andrew, or David. I don’t have my master database of black-white names handy (hey, it’s summer), but I’m pretty sure that at least five out of those six skew pretty white. So, a couple of questions:

+ What names do you think will be featured the following week?

+ Could this price-discriminating advertisement in fact be construed as racial discrimination? If there’s a plausible argument to be made that tipping should be outlawed because blacks systematically earn less than whites, might some legal wizard — armed with black-white names data — see this sign as a discriminatory discount?  

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  1. Jeanie says:

    Isn’t this all in fun?

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  2. Leah says:

    This is a tanning salon. Not a hair salon. I called.

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  3. Fred Tiffany says:

    This discount offer technically does meet the economic definition of price discrimination: charging different prices for different units of the same product or service. But economists generally assume that price discrimination is motivated by a desire to maximize profit. I don’t see how the offer fits this larger objective unless people with the posted names are systematically unlikely to be willing to pay the regular price. So, I am not sure what the economic issue is here. I am new to this blog, but I had thought is was about economics. I have no idea whether people with these names are more likely to be black or white, but I think it is a fairly well understood economic idea that turning down customers because of race is not a profit maximizing strategy.

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  4. Dee says:

    Very racist business indeed… There should be more relative diversification…It can’t be like that!

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  5. jay janney says:

    I visited the Cliffs of Mohor (sp) near Galway Ireland last week. They have a name fo the week discount on admission, based on Irish names….

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  6. Danny says:

    So, Hu Jintao could never get a free haircut then! sadness.

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  7. Paul says:

    This is not a hair salon or barber shop. The name of the place with this street sign is Fit To Be Tan, an “airbrush tanning studio”, at 1626 U Street, NW, which is a tony address. If you look at their web site you can see the blue brick behind the sign, on the front of the store.

    So, this changes the question totally, since airbrush tanning is hardly something a black person would want or need considering the average black person is pretty ‘tan’ all year-round.

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