Income-based Segregation in Urban Areas: Framework for a Complex-Systems Approach

Abstract

Income-based segregation is a fundamentally complex phenomenon. Though it can be analytically studied, developing an agent-based model allows us to study segregation at several levels of aggregation – to better understand the interactions that take place in between the micro- and macro- levels that lead to the pattern of segregation observed in modern cities. The spatial agent-based model of the housing market developed in this paper gives a foundation which can be built upon to tackle some of the key problems present in existing literature. We test the model to find that the degree to which households are willing to spend on rent relative to other expenditure and the extremity of variation of this degree in the population give rise to different patterns of segregation observed in the housing market. We assume a rental-only market, and that agents’ incomes are locally spent. A section on guidance for further development and extension of the model is then presented.