A working paper with discouraging results

Tipping and the Dynamics of Segregation

Tipping and the Dynamics of Segregation
David Card, Alexandre Mas, Jesse Rothstein
NBER Working Paper No. 13052
Issued in April 2007

—- Abstract —–

In a classic paper, Schelling (1971) showed that extreme segregation can arise from social interactions in white preferences: once the minority share in a neighborhood exceeds a critical “tipping point,” all the whites leave. We use regression discontinuity methods and Census tract data from 1970 through 2000 to test for discontinuities in the dynamics of neighborhood racial composition. White population flows exhibit tipping-like behavior in most cities, with a distribution of tipping points ranging from 5% to 20% minority share. The estimated discontinuities are robust to controls for a wide variety of neighborhood characteristics, and are as strong in the suburbs as in tracts close to high-minority neighborhoods, ruling out the main alternative explanations for apparent tipping behavior. In contrast to white population flows, there is no systematic evidence that rents or housing prices exhibit non-linearities around the tipping point. Finally, we relate the location of the estimated tipping points in different cities to measures of the racial attitudes of whites, and find that cities with more tolerant whites have higher tipping points.

Although there a small glimmer of good news—preferences for discrimination don’t have to be fixed. House prices don’t drop discontinuously at the ‘tipping’ which I think means that tipping in not completely $ based, although I don’t know how to interpret that evidence yet.

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