Tim Harford—the FT’s ‘Undercover Economist’—has produced a video demonstrating Thomas Schelling’s theory of racial segregation, in 2 minutes.
Schelling, who was awarded the 2005 Nobel Prize in Economics for “having enhanced our understanding of conflict and cooperation through game-theory analysis”, showed with his Models of Segregation that even a mild preference for the colour of your neighbour can lead to extreme segregation.
Harfords view on this:
Although we as individuals may be rational and we may be tolerant, the society that we produce together may be neither rational nor tolerant.