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Publication Date:
June 2009
ISSN:
1935-1690
DOI:
10.2202/1935-1690.1492

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Abraham, Arpad / Carceles-Poveda , Eva / Cavalcanti, Tiago / Kambourov, Gueorgui / Lambertini, Luisa / Ruhl, Kim / Tavares, Jose

The B.E. Journal of Macroeconomics

1 Issue per year

IMPACT FACTOR 2011: 0.321

 

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

William Easterly1

1New York University, william.easterly@nyu.edu

Citation Information: The B.E. Journal of Macroeconomics. Volume 9, Issue 1, Pages –, ISSN (Online) 1935-1690, DOI: 10.2202/1935-1690.1492, June 2009

Publication History:
Published Online:
2009-06-17

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.

Keywords: strategic interdependence; multiple equilibria; racial segregation; economic development

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