What can We Learn About Financial Access from U.S. Immigrants?

We find that wealthier and more educated immigrants are more likely to make use of basic banking services and other formal financial services. Holding these (and other) factors constant, we find immigrants from countries with more effective institutions are more likely to have a relationship with a bank and use formal financial markets more extensively. The impact of institutional quality affects all immigrant groups except those who have been in the United States for more than 28 years. In addition institutional quality affects all immigrants, regardless of how old they were when they migrated to the United States These findings are robust to alternative measures of institutional effectiveness and to controlling for unobserved individual characteristics