Working Paper: CEPR ID: DP13339
Authors: Graziella Bertocchi; Marianna Brunetti; Anzelika Zaiceva
Abstract: Using rich Italian data for the period 2006-2014, we document sizeable gaps between native and immigrant households with respect to wealth holdings and financial decisions. Immigrant household heads hold less net wealth than native along the entire wealth distribution. Immigrant status reduces the likelihood of holding risky assets, housing, mortgages, businesses, and valuables, and it increases the likelihoodof financial fragility. Standard regression results are corroborated by a propensity score matching strategy. Years since migration, country of origin, and the pattern of intermarriage also matter. The Great Recession has worsened the condition of immigrants in terms of wealth holdings, home ownership, and financial fragility. Results are unaffected if an immigrant is defined as a non-citizen, rather than a foreign-born.
Keywords: immigrants; household finance; wealth; financial portfolios
JEL Codes: F22; G11; D14; E21; J15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| years since migration (F22) | wealth position (D14) |
| country of origin (O57) | financial behaviors (G53) |
| patterns of intermarriage (J12) | financial behaviors (G53) |
| immigrant status (K37) | net wealth (G19) |
| immigrant status (K37) | likelihood of holding risky assets (G11) |
| immigrant status (K37) | home ownership (R21) |
| immigrant status (K37) | likelihood of holding mortgages (G21) |
| immigrant status (K37) | financial fragility (G51) |