Alexandre Mas

Are Mixed Neighborhoods Always Unstable?: Two-Sided and One-Sided Tipping

January 1, 2011 • Scholarly Publications • By Alexandre Mas, David Card and Jesse Rothstein

Neighborhood and Life Chances: How Place Matters in Modern America, Harriet B. Newburger, Eugenie Birch and Susan Wachter, eds. University of Pennsylvania Press. 2011. [accordions] [accordion title="Abstract" load="hide"]A great deal of urban policy depends on the possibility of creating stable, economically and racially mixed neighborhoods. Many social interaction models – including the seminal Schelling (1971) model – have the feature that the only stable equilibria are fully segregated. These models suggest that if home-buyers have preferences over their neighborhoods’ racial composition, a neighborhood with mixed racial composition is inherently unstable, in the sense that a small change in the composition sets off a dynamic process that converges to either 0% or 100% minority share. Card, Mas, and Rothstein (2008) outline an alternative “one-sided” tipping model in which neighborhoods with a minority share below a critical threshold are potentially stable, but those that exceed the threshold rapidly shift to 100% minority composition. In this paper we examine the racial dynamics of Census tracts in major metropolitan areas over the period from 1970 to 2000, focusing on the question of whether tipping is “two-sided” or “one-sided”. The evidence suggests that tipping behavior is one-sided, and that neighborhoods with minority shares below the tipping point attract both white and minority residents. [/accordion] [/accordions]

Long-Run Impacts of Unions on Firms: New Evidence from Financial Markets, 1961-1999

January 1, 2009 • Working Papers • By David S. Lee and Alexandre Mas

Tipping and the Dynamics of Segregation

February 1, 2008 • Scholarly Publications • By Jesse Rothstein, David Card and Alexandre Mas

Quarterly Journal of Economics, 123(1):177-218. February 2008. [accordions] [accordion title="Abstract" load="hide"]Schelling (“Dynamic Models of Segregation,” Journal of Mathematical Sociology 1 (1971), 143–186) showed that extreme segregation can arise from social interactions in white preferences: once the minority share in a neighborhood exceeds a “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. We find strong evidence that white population flows exhibit tipping-like behavior in most cities, with a distribution of tipping points ranging from 5% to 20% minority share. Tipping is prevalent both in the suburbs and near existing minority enclaves. In contrast to white population flows, there is little evidence of nonlinearities in rents or housing prices around the tipping point. Tipping points are higher in cities where whites have more tolerant racial attitudes. [/accordion] [/accordions]