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

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  • Easterly William

    (New York University)

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 U.S. 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.

Suggested Citation

  • Easterly William, 2009. "Empirics of Strategic Interdependence: The Case of the Racial Tipping Point," The B.E. Journal of Macroeconomics, De Gruyter, vol. 9(1), pages 1-35, June.
    • Handle: RePEc:bpj:bejmac:v:9:y:2009:i:1:n:25
    DOI: 10.2202/1935-1690.1492
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    Cited by:

    1. Geoffrey Heal & Howard Kunreuther, 2010. "Social Reinforcement: Cascades, Entrapment, and Tipping," American Economic Journal: Microeconomics, American Economic Association, vol. 2(1), pages 86-99, February.
    2. Peter Blair, 2017. "Outside Options (Now) More Important than Race in Explaining Tipping Points in US Neighborhoods," Working Papers 2017-071, Human Capital and Economic Opportunity Working Group.
    3. David Card & Alexandre Mas & Jesse Rothstein, 2008. "Tipping and the Dynamics of Segregation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(1), pages 177-218.
    4. David Neumark & Timothy Young, 2021. "Heterogeneous Effects of State Enterprise Zone Programs in the Shorter Run and Longer Run," Economic Development Quarterly, , vol. 35(2), pages 91-107, May.
    5. Korpi, Martin & Halvarsson, Daniel & Öner, Özge & A.V. Clark, William & Mihaescu, Oana & Östh, John & Bäckman, Olof, 2022. "Native Population Turnover & Emerging Segregation: The Role of Amenities, Crime and Housing," Ratio Working Papers 358, The Ratio Institute.
    6. Roy Cerqueti & Luca De Benedictis & Valerio Leone Sciabolazza, 2022. "Segregation with social linkages: Evaluating Schelling’s model with networked individuals," Metroeconomica, Wiley Blackwell, vol. 73(2), pages 384-440, May.
    7. Florent Dubois & Christophe Muller, 2017. "Segregation and the Perception of the Minority," AMSE Working Papers 1718, Aix-Marseille School of Economics, France.
    8. Malone, Thom, 2020. "There goes the neighborhood does tipping exist amongst income groups?," Journal of Housing Economics, Elsevier, vol. 48(C).
    9. Caetano, Gregorio & Maheshri, Vikram, 2017. "School segregation and the identification of tipping behavior," Journal of Public Economics, Elsevier, vol. 148(C), pages 115-135.
    10. Ouazad, Amine, 2015. "Blockbusting: Brokers and the dynamics of segregation," Journal of Economic Theory, Elsevier, vol. 157(C), pages 811-841.
    11. Seul-Ki Shin, 2014. "Preferences vs. Opportunities: Racial/Ethnic Intermarriage in the United States," PIER Working Paper Archive 14-040, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    12. David Card, 2007. "How Immigration Affects U.S. Cities," RF Berlin - CReAM Discussion Paper Series 0711, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    13. Henrik Andersson & Heléne Berg & Matz Dahlberg, 2017. "Native Migration Responses to Increased Immigration," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 15(03), pages 26-29, October.
    14. 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.
    15. Carlos Castro & Cristhian Rodriguez, 2016. "Racial and spatial interaction for neighborhood dynamics in Chicago," Documentos de Trabajo 14589, Universidad del Rosario.
    16. Caetano, Gregorio & Maheshri, Vikram, 2017. "School segregation and the identification of tipping behavior," Journal of Public Economics, Elsevier, vol. 148(C), pages 115-135.
    17. repec:ces:ifodic:v:15:y:2017:i:3:p:50000000000048 is not listed on IDEAS
    18. Jessica Pan, 2015. "Gender Segregation in Occupations: The Role of Tipping and Social Interactions," Journal of Labor Economics, University of Chicago Press, vol. 33(2), pages 365-408.

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    More about this item

    Keywords

    strategic interdependence; multiple equilibria; racial segregation; economic development;
    All these keywords.

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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