Undoing Difference: Risk Classification and Gender Discrimination in Consumer Financial Markets

In principle, market exchanges should not depend on the identities of the exchanging actors. The beauty of the market is its ability to coordinate interactions between strangers, without requiring or establishing long-term relationships. The ideal market is effectively anonymous, and the market’s legitimacy is premised in part on its erasure of status distinctions. Financial markets have always troubled this neat separation. Financial transactions are typically transactions over time, and thus create an enduring relationship between the parties. As such, the characteristics of the parties have always been seen as relevant. We examine struggles over the legitimacy of using status characteristics to set the terms of financial transactions to shed light on the shifting cultural logics of inclusion and exclusion in the 20th century United States. We argue that the material technologies of pricing conditioned the moral politics of markets.

Specifically, we focus on the contested morality of gender-based pricing in credit and insurance. We argue that pricing technologies materially encoded gender in ways that made it more difficult to “undo difference” in insurance markets than in credit transactions. In credit markets, lenders adopted individualized pricing when social movements challenged the morality and legality of using gender as a pricing variable. The adoption of individualized pricing that explicitly excluded gender from consideration demobilized feminist efforts to contest women’s exclusion from access to credit. Insurers faced similar pressures to eliminate gender classifications, and yet had greater difficulty integrating fully individualized pricing into pricing systems that grew out of older traditions of risk sharing in insurance. As a result, the category “gender” remained salient in insurance markets, both as a means of price discrimination and as a social identity that could provide a basis for mobilization.