We interpret the psychology literature on social identity and examine its implications in a population partially composed of such agents. We model a population of agents from two exogenous and well defined social groups. Agents are randomly matched to play a reduced form bargaining game. We show...

We present evidence that more ethnically fragmented communities spend, all else equal, more on police services than less fragmented communities. We introduce a model of spending on police services which we use to interpret the data. In this model, we assume that the decision to commit a crime is...

Using a Two-Stage Least Squares procedure, we estimate the relationship between ethnic fragmentation and police spending using a cross-section of United States counties. Our results show that, when controlling for community characteristics and accounting for simultaneity bias, ethnic...