The Financial Decisions of Immigrant and Native Households: Evidence from Italy

Bertocchi GraziellaBrunetti MariannaZaiceva Anzelika
CEIS Research Paper
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 likelihood of 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.

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Number: 449
Keywords: immigrants, household finance, wealth, financial portfolios
JEL codes: F22,G11,D14,E21,J15
Volume: 17
Issue: 1
Date: Friday, January 25, 2019
Revision Date: Tuesday, May 12, 2020