Tuesday, July 14, 2009

The Tipping Point: Fascinating But Mythological?

Is the "tipping point" just a book selling idea and not a concept supported by real life data?

Read NYU economics professor William Easterly's blog, "The Tipping Point: Fascinating but mythological?"
The “tipping point” is a popular concept covering a whole range of phenomena (and a best-selling book by Malcolm Gladwell) where individual behaviour depends on the behaviour of the herd.

Its original application was to racial segregation. Nobel Laureate Thomas Schelling developed a beautifully simple model for this. Suppose that whites have different degrees of racism – some would “tolerate” higher shares of non-whites in their local neighbourhood than others. Schelling showed that even the less racist whites would still wind up exiting during tipping because of a chain reaction....

Tipping point stories are fascinating, but do we observe them in the real world? I became intrigued with this question a while ago and eventually published a paper testing the predictions of the tipping point story for its original application – racial segregation of US neighbourhoods (Easterly 2009).
Read the full blog here.

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