Mexican Americans and wealth: economic status, family and place

Abstract

We examine the effect of economic, family, and metropolitan area characteristics on Mexican Americans’ wealth outcomes. We use data from the Mexican American Study Project, a data set that allows us to examine longitudinal and intergenerational change. We find that Mexican Americans have one main source of wealth – home equity. Moreover, length of marriage among parent respondents was key for their wealth accumulation, while education and income were important for wealth accumulation among their adult children. Additionally, we find that parents’ wealth has a limited impact on their children’s wealth. Our results suggest that Mexican Americans’ wealth outcomes are mainly attributed to their own economic efforts, rather than the resources passed down from their parents. We argue that Mexican Americans’ modest financial resources and limited intergenerational support stymies their wealth progress. These findings substantiate the challenges of building wealth from a low starting point in socioeconomic resources and structurally-disadvantaged labour market position. Since parental wealth can lift a family beyond its own achievements, Mexican Americans may not be able to achieve financial security in the same manner as do whites. These findings have important implications for the financial conditions of Mexican immigrants and their descendants.