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Savings, Asset Holdings, and Temporary Migration

Author

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  • Dustmann, Christian

    (University College London)

  • Mestres, Josep

    (OECD)

Abstract

This paper analyzes savings and asset holdings of immigrants in relation to their return plans. We argue that savings and asset accumulation may be affected by return plans of immigrants. Further, the way savings and assets are held in the home- and host country may also be related to future return plans. Thus, comparing savings and assets between immigrants and natives may lead to serious underestimation when neglecting the home country component. We show that immigrants with temporary return plans place a higher proportion of their savings in the home country. In addition, both the magnitude and the share of assets and housing value accumulated in the home country are larger for immigrants who consider their migration as temporary, and lower the value of assets and property held in the host country. Finally, and conditional on observable characteristics, we find no evidence that immigrants with temporary migration plans save more than immigrants with permanent migration plans.

Suggested Citation

  • Dustmann, Christian & Mestres, Josep, 2011. "Savings, Asset Holdings, and Temporary Migration," IZA Discussion Papers 5498, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp5498
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    References listed on IDEAS

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    1. Sinning, Mathias, 2007. "Wealth and Asset Holdings of Immigrants in Germany," IZA Discussion Papers 3089, Institute of Labor Economics (IZA).
    2. Thomas Bauer & Mathias Sinning, 2011. "The savings behavior of temporary and permanent migrants in Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(2), pages 421-449, April.
    3. Dustmann, Christian & Kirchkamp, Oliver, 2002. "The optimal migration duration and activity choice after re-migration," Journal of Development Economics, Elsevier, vol. 67(2), pages 351-372, April.
    4. Catalina Amuedo-Dorantes & Susan Pozo, 2002. "Precautionary Saving by Young Immigrants and Young Natives," Southern Economic Journal, John Wiley & Sons, vol. 69(1), pages 48-71, July.
    5. Dean Yang, 2008. "International Migration, Remittances and Household Investment: Evidence from Philippine Migrants’ Exchange Rate Shocks," Economic Journal, Royal Economic Society, vol. 118(528), pages 591-630, April.
    6. Francine D. Blau & John W. Graham, 1990. "Black-White Differences in Wealth and Asset Composition," The Quarterly Journal of Economics, Oxford University Press, vol. 105(2), pages 321-339.
    7. Deborah A. Cobb‐Clark & Vincent A. Hildebrand, 2006. "The Wealth And Asset Holdings Of U.S.‐Born And Foreign‐Born Households: Evidence From Sipp Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 52(1), pages 17-42, March.
    8. Mathias Sinning, 2010. "Homeownership and Economic Performance of Immigrants in Germany," Urban Studies, Urban Studies Journal Limited, vol. 47(2), pages 387-409, February.
    9. Darren Lubotsky, 2007. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Journal of Political Economy, University of Chicago Press, vol. 115(5), pages 820-867, October.
    10. Bernt Bratsberg & Erling Barth & Oddbjørn Raaum, 2006. "Local Unemployment and the Relative Wages of Immigrants: Evidence from the Current Population Surveys," The Review of Economics and Statistics, MIT Press, vol. 88(2), pages 243-263, May.
    11. Dustmann, Christian & Mestres, Josep, 2010. "Remittances and temporary migration," Journal of Development Economics, Elsevier, vol. 92(1), pages 62-70, May.
    12. Galor, Oded & Stark, Oded, 1990. "Migrants' Savings, the Probability of Return Migration and Migrants' Performance," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 31(2), pages 463-467, May.
    13. Woodruff, Christopher & Zenteno, Rene, 2007. "Migration networks and microenterprises in Mexico," Journal of Development Economics, Elsevier, vol. 82(2), pages 509-528, March.
    14. Erling Barth & Bernt Bratsberg & Oddbjørn Raaum, 2004. "Identifying Earnings Assimilation of Immigrants under Changing Macroeconomic Conditions," Scandinavian Journal of Economics, Wiley Blackwell, vol. 106(1), pages 1-22, March.
    15. Dustmann, Christian, 1997. "Return migration, uncertainty and precautionary savings," Journal of Development Economics, Elsevier, vol. 52(2), pages 295-316, April.
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    Cited by:

    1. Akay, Alpaslan & Brausmann, Alexandra & Djajic, Slobodan & Kirdar, Murat G., 2018. "Purchasing-Power-Parity and the Saving Behavior of Temporary Migrants," IZA Discussion Papers 11679, Institute of Labor Economics (IZA).
    2. Fran�ois-Charles Wolff, 2015. "Do the Return Intentions of French Migrants Affect Their Transfer Behaviour?," Journal of Development Studies, Taylor & Francis Journals, vol. 51(10), pages 1358-1373, October.
    3. Effrosyni Adamopoulou & Ezgi Kaya, 2020. "Not just a work permit: EU citizenship and the consumption behaviour of documented and undocumented immigrants," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(4), pages 1552-1598, November.
    4. Ihle Dorothee & Siebert-Meyerhoff Andrea, 2019. "The Evolution of Immigrants’ Homeownership in Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 239(2), pages 155-201, April.
    5. Akay, Alpaslan & Brausmann, Alexandra & Djajić, Slobodan & Kırdar, Murat G., 2021. "Purchasing-power-parity and the saving behavior of temporary migrants," European Economic Review, Elsevier, vol. 134(C).

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    More about this item

    Keywords

    international migration; wealth accumulation; housing demand;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

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