We introduce a Schelling model in which people are modelled as agents following simple behavioural rules which dictate their tolerance to others, their corresponding preference for particular locations, and in turn their movement through a geographic or social space. Our innovation over previous work is to allow agents to adapt their tolerance to others in response to their local environment, in line with contemporary theories from social psychology. We show that adaptive tolerance leads to a polarization in tolerance levels, with distinct modes at either extreme of the distribution. Moreover, agents self-organize into communities of like-tolerance, just as they congregate with those of same colour. Our results are robust not only to variations in free parameters, but also experimental treatments in which migrants are dynamically introduced into the native population. We argue that this model provides one possible parsimonious explanation of the political landscape circa 2016
