Immigrant-Native Differences in Financial Market Participation
The goal of this paper is to investigate the prospects for the wealth assimilation of
immigrants by studying the financial market behavior of U.S. immigrants, compared to the
native-born. Compared to similar natives, immigrants are less likely to own a wide range of
financial assets, including savings and checking accounts. Immigrant status also has a
significant impact on transitions out of account ownership. We find that lower rates of financial
market participation tend to persist even for immigrants who have lived in the U.S. for several
years. Our results suggest that a large share of the immigrant-native gap in financial market
participation is driven by group differences in education, income, and geographic location. For a
given immigrant, the likelihood of financial market participation decreases with higher levels of
ethnic concentration in the metropolitan area.
