Black Reparations Pricing: Woke Justice or Price Discrimination at Rivendell?

Is a 45% discount offered to Black customers a form of reparations to those customers? Is it instead a form of price discrimination (whether just or unjust)? Is it just clever-because-timely marketing?

Founded by bicycle industry legend and maverick Grant Petersen in 1994, Rivendell Bicycle Works has always done things its own way. (Disclosure: One of the editors is a bicycle enthusiast and owns two Rivendell bicycles.) For example, Rivendell makes old-school steel bicycles with lugged frames, long after the industry moved to TIG-welded aluminum or carbon fiber, and chooses components based on their reliability and easy reparability, rather than on their novelty and technological wizardry. Founder Petersen sees bicycles ridden for transportation and to run errands as integral to – and expressive of the values informing – the environmental movement.

Understanding their bicycles in an environmentally sensitive and socially transformative way, Rivendell may be quicker than others in its industry to see its business through the lens of divisive social issues. Against that backdrop, beginning October 12 Rivendell is offering up to 10% of its inventory to Black customers at a 45% discount to regular pricing.

Some questions that could inform classroom discussion about Rivendell’s move:

  1. Is a discount on a purchase a form of compensation for a wrong done to the recipient of the discount? We usually think that compensatory justice demands unconditional compensation to the wronged, paid by the wrongdoer. If Petersen thinks this compensation is not “a nice thing to do, but [is] owed,” is it right that it may be collected by the wronged only by way of making a purchase at Rivendell?
  2. As is discussed briefly in the linked article, exclusive discounts are a form of price discrimination. Is it, however, an unjust form of price discrimination? Moral intuitions surrounding price discrimination – charging different people different prices for the same good or service – are complicated. On one hand, lots of people think price discrimination generally wrongful: people buying the same good or service ought to pay the same price for it. On the other hand, many of the same people holding that view believe that particular instances of price discrimination are morally praiseworthy—for example, senior-citizen discounts and student discounts. What are the features of the praiseworthy instances that separate them from the generally wrongful ones? Does the Black reparations discount on Rivendell bicycles have those features?
  3. If one holds the view that this is merely clever marketing, is Rivendell blameworthy for engaging in clever marketing over this topic? How? Why? >>>

LINK: A bike company offers Black customers reparations in the form of a discount (by Ethan Wolff-Mann at Yahoo! Finance)

As companies grapple with their roles in contributing to racial equality and inequality, diversity and inclusion programs have taken on more importance in the corporate world.

But in retail, one well-regarded bicycle brand led by an industry legend is innovating a more direct approach to address racial inequality: reparations in the form of a 45% discount for Black customers.

Rivendell Bicycle Works, based in Walnut Creek, Calif., is offering the discount not because they are “a nice thing to do, but because they’re owed,” Grant Petersen, Rivendell’s president and founder, wrote in a post explaining the new policy…..

What do you think?


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About Chris MacDonald

I'm a philosopher who teaches at Ryerson University's Ted Rogers School of Management in Toronto, Canada. Most of my scholarly research is on business ethics and healthcare ethics.

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