This article develops an original, integrative theoretical framework that connects game-theoretic models of strategic interaction with sociological theories of residential segregation, institutional behavior, and emergent social inequality. Drawing exclusively on foundational works in game theory, industrial organization, and urban sociology, the study argues that many persistent patterns of economic and social inequality can be understood as equilibrium outcomes of interdependent individual and institutional decisions rather than as the result of isolated preferences or exogenous constraints. Building on the strategic logic formalized in classic game theory (Fudenberg and Tirole, 1991) and later extended through analyses of oligopolistic behavior and complementarities (Vives, 1999; Vives, 2005), the article conceptualizes social segregation, tax compliance, school enrollment stability, and neighborhood change as coordination problems characterized by strategic complementarities and path dependence.
The article further integrates sociological accounts of residential segregation and racial dynamics in American cities, including analyses of segregation trends, city-suburb institutional boundaries, and behavioral responses to demographic change (Galster, 1988; Massey and Gross, 1991; James, 1989). These perspectives are reinterpreted through a strategic lens, emphasizing how individual actions—such as residential choice, school enrollment decisions, or tax evasion—are shaped by expectations about the behavior of others. Theoretical insights from studies of racial attraction and avoidance (Hwang and Murdock, 1998), class awareness (Jackman and Jackman, 1983), and enrollment stability in desegregating schools (Giles, 1978) are analyzed as manifestations of coordination dynamics rather than purely attitudinal phenomena.
A central contribution of this article lies in its application of emergent systems thinking to social and economic processes. Inspired by interdisciplinary accounts of emergence in biological, technological, and urban systems (Johnson, 2001) and popularized theories of tipping points in social change (Gladwell, 2000), the article demonstrates how small, localized strategic adjustments can produce large-scale, persistent structural outcomes. Tax policy and market power are also incorporated into this framework through a reexamination of monopoly behavior and nonneutral profit taxation (Lee, 1998), highlighting how institutional design interacts with strategic incentives to shape compliance and efficiency.
Methodologically, the article adopts a qualitative, theory-driven synthesis approach, using descriptive analytical reasoning rather than formal modeling or empirical estimation. This approach allows for deep theoretical elaboration, critical comparison of competing interpretations, and the development of a unified conceptual narrative across disciplines. The results of this synthesis suggest that inequality, segregation, and institutional rigidity are best understood as equilibrium phenomena sustained by mutual expectations and reinforcing feedback loops.
The discussion section reflects on the normative and policy implications of this perspective, emphasizing the challenges of disrupting entrenched equilibria and the importance of coordinated interventions. The article concludes by outlining directions for future research that integrate strategic interaction, institutional analysis, and emergent social dynamics into a more comprehensive theory of inequality and social change.
