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Not being a racist makes it acceptable to not take race or a surrogate for race into condition for a loan ;-) (Please don't take that the wrong way. I am not a
by InTheArena 10y ago
Not being a racist makes it acceptable to not take race or a surrogate for race into condition for a loan ;-)
(Please don't take that the wrong way. I am not accusing anyone of racism. Simply stating that at some points our ideals is more valuable then an additional point of profits for the bank).
Disparate impact and it's use in credit scoring is mostly governed by Equal Credit Opportunity Act (ECOA), but most of the banks I am aware of go steps further in ensuring that disparate impact does not occur.
- Houshalter 10y agoThis is only important if you believe that racial stereotypes are true, but should be ignored. That if you control for education, income, region, etc, differences between races are still significant. Disparate impact goes well beyond removing race as a feature. You sometimes can't use features that correlate with race, even if they are highly predictive. E.g. education. It also has nothing to do with the profits of banks. Better prediction algorithms for loans mean less interest rates for people that are good borrowers, and less crippling debt to those that aren't. It has huge benefit to the economy and society.
- yummyfajitas 10y agoSo it's racist to act on true beliefs? Consider a woman walking down the street late at night. Dark alley 1 has a black man. Dark alley 2 has an Asian female. Is she racist if she walks down the alley that minimizes her risk of violence?
- dwaltrip 10y agoSociety has chosen to not regulate which alleyways people choose to walk down. There are many things that individuals are free to do but organizations are not.
- yummyfajitas 10y agoI wasn't asking about regulation, but merely whether this makes the woman racist. Are individuals now unable to be racist?