Auto Repair Shops Really Do Charge Women More (Sometimes)

A new study suggests that auto repair shops overcharge women.

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"There is this gender interaction between how informed people appear to be and the prices they get," says one expert.

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Today, from the confirming-your-suspicions desk: Women really do end up paying more at the mechanic shop than men ... sometimes.

Three researchers from Northwestern University wanted to take on the question of "whether sellers treat consumers differently on the basis of how well-informed consumers appear to be," as they wrote in their finished paper, as well as how gender plays into that relationship. They decided to study it via a place where many consumers already feel vulnerable to unfair pricing: the auto repair shop.

"What we found is the result people have really found intuitive – that there is this gender interaction between how informed people appear to be and the prices they get," says Meghan Busse, associate professor of management and strategy at the Kellogg School of Management at Northwestern University. "Women who call up and say they have no idea what the price ought to be are quoted higher prices than men who call up and say, 'I have no idea what the price ought to be.'"

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The researchers performed the study in the summer and fall 2012 by having call center agents call auto repair shops in a variety of cities to ask about getting a radiator replaced on a 2003 Toyota Camry – a repair that the researchers determined would cost around $365. Some of the participants were asked to quote an expected price, while others did not. It was among this latter group that price differences cropped up.

On average, women callers were quoted higher prices than men callers were, but the results also reveal nuances based on how much callers knew about their cars.

Busse and her team found that when callers did not mention prices, women were quoted prices $13 higher than when they said they expected it to cost around $365. Men, meanwhile, were quoted prices nearly $10 lower than when they mentioned that price. (However, the researchers noted this price difference for men was of "borderline statistical significance" in the experiment.)

 

By contrast, when callers quoted a price of any sort, the gender differences disappeared. Men and women who appeared "well informed" – that is, who said they expected the repair to cost $365 – received similar price quotes, and men and women who appeared "poorly informed" and said they expected a price of $510 likewise received similar (and high) price quotes.

Busse says that this shows a phenomenon more complicated than simple gender discrimination; she calls it "statistical discrimination."

"What we think best explains this is that shops believe for whatever reason – just or unjust – that women know less about cars or know less about car repair," she says. She says shops appear to have an attitude that "if you're well informed you get the price that we cite to well-informed people, and if you're poorly informed, whether you're a man or woman, we cite you the price that we cite to poorly informed people."

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While the study only looked at pricing differences based on gender and information levels, there is also evidence that race can play a part in pricing as well. A 1995 study, for example, found that race and gender alike affected customers' negotiations in purchasing a new car.

One aspect the researchers did not track was the gender of the people answering the phone.

"This is the one thing that after we finished the experiment, we kind of kicked ourselves for not having collected," she says. However, call center agents' records allowed her to estimate that 85 percent of the auto repair shop workers were men. Given the small share of women in that sample, Busse says, it might have been difficult to glean conclusive evidence on how workers' gender impacted how they treated different callers.

Still, the results do provide helpful advice to anyone bringing their car into the shop: Women would do well to study up. Men, meanwhile, may want to just remain silent and see what prices they get.

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