There are many reasons to decline a reservation inquiry with scams quickly joining the list of reasons hosts might have to not want to accept a guest. The reasons we want to decline a guest is never racial or xenophobic, just it doesnt work.
The direct Accept/Decline choice is clearly insufficient. We are penalized for declining all those people who want add extra bodies, unsuitably aged children, pets and unavailable dates, absurd discounts and the list goes on. This just too common an occurance these days not to need a change to the existing parameters.
A third button, Not Possible should work...rejecting the reservation, not the guest. And should not reflect poorly on the host as it is usually the guests' request is what would trigger it. The button should reflect that while they sound charming, the booking is not possible.
Recently, Airbnb sent a booking inquiry for dates I was already booked through Airbnb. I wrote the lady and explained why I could not host her and then accepted her 24 hours later when she had gone elsewhere. I shouldnt have to do this.