Proof.
In this paragraph we reduce to the case where B is an affine scheme. Let B' \to B be an étale morphism of algebraic spaces. Observe that conditions (1) and (2) are preserved if we replace B, X_ i, X by B', X_ i \times _ B B', X \times _ B B'. Let \{ B_ a \to B\} _{a \in A} be an étale covering with B_ a affine, see Properties of Spaces, Lemma 66.6.1. For a \in A denote X_ a, X_{a, i} the base changes of X and the diagram to B_ a. For a, b \in A denote X_{a, b} and X_{a, b, i} the base changes of X and the diagram to B_ a \times _ B B_ b. By Lemma 81.3.2 it suffices to prove that X_ a = \mathop{\mathrm{colim}}\nolimits X_{a, i} and X_{a, b} = \mathop{\mathrm{colim}}\nolimits X_{a, b, i}. This reduces us to the case where B = B_ a (an affine scheme) or B = B_ a \times _ B B_ b (a separated scheme). Repeating the argument once more, we conclude that we may assume B is an affine scheme (this uses that the intersection of affine opens in a separated scheme is affine).
Assume B is an affine scheme. Let Z be an algebraic space over B. We have to show
\mathop{\mathrm{Mor}}\nolimits _ B(X, Z) \longrightarrow \mathop{\mathrm{lim}}\nolimits \mathop{\mathrm{Mor}}\nolimits _ B(X_ i, Z)
is a bijection.
Proof of injectivity. Let f, g : X \to Z be morphisms such that the compositions f_ i, g_ i : X_ i \to Z are the same for all i. Choose an affine scheme Z' and an étale morphism Z' \to Z. By Properties of Spaces, Lemma 66.6.1 we know we can cover Z by such affines. Set U = X \times _{f, Z} Z' and U' = X \times _{g, Z} Z' and denote p : U \to X and p' : U' \to X the projections. Since f_ i = g_ i for all i, we see that
U_ i = X_ i \times _{f_ i, Z} Z' = X_ i \times _{g_ i, Z} Z' = U'_ i
compatible with transition morphisms. By (1) there is a unique isomorphism \epsilon : U \to U' as algebraic spaces over X, i.e., with p = p' \circ \epsilon which is compatible with the displayed identifications. Choose an étale covering \{ h_ a : U_ a \to U\} with U_ a affine. By (2) we see that f \circ p \circ h_ a = g \circ p' \circ \epsilon \circ h_ a = g \circ p \circ h_ a. Since \{ h_ a : U_ a \to U\} is an étale covering we conclude f \circ p = g \circ p. Since the collection of morphisms p : U \to X we obtain in this manner is an étale covering, we conclude that f = g.
Proof of surjectivity. Let f_ i : X_ i \to Z be an element of the right hand side of the displayed arrow in the first paragraph of the proof. It suffices to find an étale covering \{ U_ c \to X\} _{c \in C} such that the families f_{c, i} \in \mathop{\mathrm{lim}}\nolimits _ i \mathop{\mathrm{Mor}}\nolimits _ B(X_ i \times _ X U_ c, Z) come from morphisms f_ c : U_ c \to Z. Namely, by the uniqueness proved above the morphisms f_ c will agree on U_ c \times _ X U_ b and hence will descend to give the desired morphism f : X \to Z. To find our covering, we first choose an étale covering \{ g_ a : Z_ a \to Z\} _{a \in A} where each Z_ a is affine. Then we let U_{a, i} = X_ i \times _{f_ i, Z} Z_ a. By (1) we find U_{a, i} = X_ i \times _ X U_ a for some algebraic spaces U_ a étale over X. Then we choose étale coverings \{ U_{a, b} \to U_ a\} _{b \in B_ a} with U_{a, b} affine and we consider the morphisms
U_{a, b, i} = X_ i \times _ X U_{a, b} \to X_ i \times _ X U_ a = X_ i \times _{f_ i, Z} Z_ a \to Z_ a
By (2) we obtain morphisms f_{a, b} : U_{a, b} \to Z_ a compatible with these morphisms. Setting C = \coprod _{a \in A} B_ a and for c \in C corresponding to b \in B_ a setting U_ c = U_{a, b} and f_ c = g_ a \circ f_{a, b} : U_ c \to Z we conclude.
\square
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