ISS 215 Lecture Notes - Lecture 24: Disparate Impact, Inheritance

• School: MSU
• Department: Integrative Studies Social Sci
• Course: ISS 215
• Professor: J. Cesario

Document Summary

If median household income (more than ,000) is the same for asians, whites, hispanics and blacks, we give them a mortgage. Under these factors, the person will deal equal amounts of mortgages. If in fact household incomes differ (which in fact they do), and we still apply the exact same criteria (more than 50,000 you get it, less than 50,000 you don"t, and the banker does the same), The outcomes are still going to differ due to the underlying criteria. If the test has a disparate impact, you can not use the test unless it shows it"s necessary for the performance (even if it"s done fairly) There are easy and difficult solutions to problems. Forcing bankers to not look at household incomes as a measure and/or credit scores as a measure will allow the bankers to possibly give mortgages to people who won"t be able to pay them back. Blacks and hispanics fare worse than whites.