Abstract
We consider a model in which each individual belonging to an ethnic minority group is embedded in a network of relationships and decides whether she wants to be integrated in the society. Each individual wants her behavior to agree with her personal ideal preference for integration but also wants her behavior to be as close as possible to the average integration behavior of her peers. We show that there is always convergence to a steady-state and characterize it. We also show that different preferences for integration may emerge in steady state depending on the structure of the network. Then, we consider an optimal tax/subsidy policy which aim is to reach a certain level of integration in the population.
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