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Empirics of Strategic Interdependence: The Case of the Racial Tipping Point

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William Easterly

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Abstract

The Schelling model of a "tipping point" in racial segregation, in which whites flee a neighborhood once a threshold of nonwhites is reached, is a canonical model of strategic interdependence. The idea of "tipping" explaining segregation is widely accepted in the academic literature and popular media. I use census tract data for metropolitan areas of the US from 1970 to 2000 to test the predictions of the Schelling model and find that this particular model of strategic interaction largely fails the tests. There is more "white flight" out of neighborhoods with a high initial share of whites than out of more racially mixed neighborhoods

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15069.

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Date of creation: Jun 2009
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Handle: RePEc:nbr:nberwo:15069

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D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
R0 - Urban, Rural, and Regional Economics - - General
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology

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  1. Roland Benabou, 1996. "Heterogeneity, Stratification, and Growth," NBER Working Papers 4311, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  2. David M. Cutler & Edward L. Glaeser & Jacob L. Vigdor, 1999. "The Rise and Decline of the American Ghetto," Journal of Political Economy, University of Chicago Press, vol. 107(3), pages 455-506, June. [Downloadable!] (restricted)
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  3. Card, David & Rothstein, Jesse, 2007. "Racial segregation and the black-white test score gap," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2158-2184, December. [Downloadable!] (restricted)
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  4. Aaronson, Daniel, 2001. "Neighborhood Dynamics," Journal of Urban Economics, Elsevier, vol. 49(1), pages 1-31, January. [Downloadable!] (restricted)
  5. Benabou, Roland, 1993. "Workings of a City: Location, Education, and Production," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 619-52, August. [Downloadable!] (restricted)
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  6. David Card & Alexandre Mas & Jesse Rothstein, 2008. "Tipping and the Dynamics of Segregation," The Quarterly Journal of Economics, MIT Press, vol. 123(1), pages 177-218, 02. [Downloadable!] (restricted)
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  7. Durlauf, Steven N, 1996. " A Theory of Persistent Income Inequality," Journal of Economic Growth, Springer, vol. 1(1), pages 75-93, March.
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  1. David Card, 2007. "How Immigration Affects U.S. Cities," CReAM Discussion Paper Series 0711, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London. [Downloadable!]
  2. Geoffrey Heal & Howard Kunreuther, 2007. "Social Reinforcement: Cascades, Entrapment and Tipping," NBER Working Papers 13579, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. David Card & Alexandre Mas & Jesse Rothstein, 2007. "Tipping and the Dynamics of Segregation," NBER Working Papers 13052, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Dana Schüler & Julian Weisbrod, 2006. "Ethnic Fractionalization, Migration and Growth," Ibero America Institute for Econ. Research (IAI) Discussion Papers 148, Ibero-America Institute for Economic Research. [Downloadable!]
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