DP12630 Immigration into Prejudiced Societies: Segregation and Echo Chambers effects
We analyze the dynamic short and long-run effects of immigration waves on attitudes towards immigrants and social cohesion. We consider a model in which both the home society and the immigrants have the same levels of cultural capacity for cooperation and mutual trust, but individuals in the home society have different degrees of prejudice about the culture of the immigrants. Prejudice is modelled as the beliefs of individuals in the home society about the immigrants' capacity for cooperation. We analyze social interactions in the presence of prejudice when individuals in the home society can segregate away from immigrants. We show that in societies with high levels of prejudice, segregation, by providing information about prejudice, can enhance cooperation in the short-term. However, when individuals learn and update their beliefs based on their experiences, segregation induces polarisation. Moreover, when individuals also socialise and exchange information in segregated communities, echo-chamber effects arise and imply that segregation reduces welfare and trust in society.