March 1, 2007
Schelling (1969, 1971a,b, 1978) considered a simple proximity model of segregation where individual agents only care about the types of people living in their own local geographical neighborhood, the spatial structure being represented by one- or two-dimensional lattices. In this paper, we argue that segregation might occur not only in the geographical space, but also in social environments. Furthermore, recent empirical studies have documented that social interaction structures are well-described by small-world networks. We generalize Schelling's model by allowing agents to interact in small-world networks instead of regular lattices. We study two alternative dynamic models where agents can decide to move either arbitrarily far away (global model) or are bound to choose an alternative location in their social neighborhood (local model). Our main result is that the system attains levels of segregation that are in line with those reached in the lattice-based spatial proximity model. Thus, Schelling's original results seem to be robust to the structural properties of the network.
J.E.L classification codes: C72, C73, D62
Keywords:Spatial proximity model, Social segregation, Schelling, Proximity preferences, Social networks, Small worlds, Scale-free networks, Best-response dynamics