People assumed that segregated cities were created solely by extreme racial hatred and overt bigotry; Thomas Schelling proved on a simple checkerboard that mild personal preferences for having just a few similar neighbors inevitably divide entire cities into segregated racial islands. Awarded the 2005 Nobel Prize in Economics, Schelling’s Segregation Model revolutionized urban economics, game theory, and agent-based computer modeling, showing why integrated communities unravel without active policy integration.

In American cities, residential neighborhood segregation was severe and persistent: Black and white families lived in completely divided neighborhoods. Sociologists assumed that this total spatial divide was driven exclusively by extreme racial animosity among all residents.
Harvard economist Thomas Schelling set up pennies and dimes on a simple checkerboard. He gave each coin a mild, tolerant rule: a coin is happy as long as at least one-third of its neighbors are the same coin type. As coins that feel slightly outnumbered move to new squares, they trigger a chain reaction—causing the checkerboard to sort itself into one hundred percent segregated blocks.
Schelling won the 2005 Nobel Prize and established the law of "Micro-Motives and Macrobehavior." By proving that individual good intentions are not enough to keep cities integrated, by inspiring affirmative fair housing incentives, and by founding agent-based computational economics, Schelling’s model transforms urban policy.
Dynamic models of segregation†
Some segregation results from the practices of organizations, some from specialized communication systems, some from correlation with a variable that is non‐random; and some results from the interplay of individual choices. This is an abstract study of the interactive dynamics of discriminatory individual choices. One model is a simulation in which individual members of two recognizable groups distribute themselves in neighborhoods defined by reference to their own locations. A second model is analytic and deals with compartmented space. A final section applies the analytics to ‘neighborhood tipping.’ The systemic effects are found to be overwhelming: there is no simple correspondence of individual incentive to collective results. Exaggerated separation and patterning result from the dynamics of movement. Inferences about individual motives can usually not be drawn from aggregate patterns. Some unexpected phenomena, like density and vacancy, are generated. A general theory of ‘tipping’ begins to emerge.
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