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Strategic behavior in Schelling dynamics: A new result and experimental evidence

Author

Listed:
  • Juan Miguel Benito

    (Universidad Pública de Navarra)

  • Pablo Brañas-Garza

    (Universidad de Granada)

  • Penélope Hernández

    (ERI-CES)

  • Juan A. Sanchis

    (ERI-CES)

Abstract

In this paper we experimentally test Schelling's (1971) segregation model and confirm the striking result of segregation. In addition, we extend Schelling's model theo- retically by adding strategic behavior and moving costs. We obtain a unique subgame perfect equilibrium in which rational agents facing moving costs may find it optimal not to move (anticipating other participants' movements). This equilibrium is far for full segregation. We run experiments for this extended Schelling model. We find that the percentage of strategic players dramatically increases with the cost of moving and that the degree of segregation depends on the distribution of rational subjects.

Suggested Citation

  • Juan Miguel Benito & Pablo Brañas-Garza & Penélope Hernández & Juan A. Sanchis, 2012. "Strategic behavior in Schelling dynamics: A new result and experimental evidence," Discussion Papers in Economic Behaviour 0312, University of Valencia, ERI-CES.
    • Handle: RePEc:dbe:wpaper:0312
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    References listed on IDEAS

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    1. Ariel Rubinstein, 2007. "Instinctive and Cognitive Reasoning: A Study of Response Times," Economic Journal, Royal Economic Society, vol. 117(523), pages 1243-1259, October.
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    3. Juan Miguel Benito & Pablo Brañas-Garza & Penélope Hernández & Juan A. Sanchis, 2011. "Sequential versus Simultaneous Schelling Models: Experimental Evidence," Journal of Conflict Resolution, Peace Science Society (International), vol. 55(1), pages 60-84, February.
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    Cited by:

    1. Coralio Ballester & Penélope Hernández, 2010. "Bounded Rationality," ThE Papers 10/10, Department of Economic Theory and Economic History of the University of Granada..
    2. Benito-Ostolaza, Juan M. & Sanchis-Llopis, Juan A., 2014. "Training strategic thinking: Experimental evidence," Journal of Business Research, Elsevier, vol. 67(5), pages 785-789.
    3. Drechsler, Martin, 2023. "Improving models of coordination incentives for biodiversity conservation by fitting a multi-agent simulation model to a lab experiment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 102(C).
    4. Juan M. Benito-Ostolaza & Penélope Hernández & Juan A. Sanchis-Llopis, 2015. "Are individuals with higher cognitive ability expected to play more strategically?," Working Papers 1507, Department of Applied Economics II, Universidad de Valencia.
    5. Benito-Ostolaza, Juan M. & Hernández, Penélope & Sanchis-Llopis, Juan A., 2016. "Do individuals with higher cognitive ability play more strategically?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 64(C), pages 5-11.

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    More about this item

    Keywords

    Subgame perfect equilibrium; segregation; experimental games;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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