Schelling's spatial proximity model of segregation revisited

Schelling [Schelling, T.C., 1969. Models of Segregation. American Economic Review, Papers and Proceedings, 59, 488-493, Schelling, T.C., 1971a. Dynamic Models of Segregation. Journal of Mathematical Sociology, 1 (2), 143–186, Schelling, T.C., 1971b. On the Ecology of Micromotives. The Public Interest, 25, 61–98, Schelling, T.C., 1978. Micromotives and Macrobehavior. New York: Norton.] presented a microeconomic model showing how an integrated city could unravel to a rather segregated city, notwithstanding relatively mild assumptions concerning the individual agents' preferences, i.e., no agent preferring the resulting segregation. We examine the robustness of Schelling's model, focusing in particular on its driving force: the individual preferences. We show that even if all individual agents have a strict preference for perfect integration, best-response dynamics may lead to segregation. This raises some doubts on the ability of public policies to generate integration through the promotion of openness and tolerance with respect to diversity. We also argue that the one-dimensional and two-dimensional versions of Schelling's spatial proximity model are in fact two qualitatively very different models of segregation. © 2006 Elsevier B.V. All rights reserved. JEL classification: C72; C73; D62