OUP - Abstract

Asian Americans and Wealth: The Role of Housing and Non-Housing Assets

Dissertation School: University of California, Los Angeles

Pages: 24

Publication Date: 07/2005

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Access Number: 5011

Abstract:

This paper has two goals: 1) to provide a statistical profile from available data of wealth among Asian Americans relative to other racial groups and among Asian American ethnic groups; and 2) to provide insights into the complex ways immigration, race, and ethnicity interact in generating Asian American wealth outcomes. Asian Americans are widely viewed as an economically successful minority that has overcome more than a century of harsh discrimination, including state-sponsored acts of racism that at various points in time have restricted their right to immigration, citizenship, property, and family formation in the United States. In fact, racial ghettos had their origins in the latter half of the nineteenth century, when White citizens imposed the segregation of Asians in California by enacting the first use of racially motivated land use laws. The colonization of Filipinos and the mass incarceration of the Japanese during World War II stand as shameful examples of blatant acts of domestic and international racism perpetrated by this country (Takaki, 1990; Chan, 1991). Despite this history, contemporary Asian Americans have achieved a level of economic status that has earned them the label of being a "model minority." As with all stereotypes, this one has an element of truth.

The media hype on Asian American accomplishments has focused on education and income, but has recently included popular articles on Asian American wealth. In 2000, Forbes heralded the entry of eight Asian Americans into the ranks of America's 400 wealthiest (DiCarlo, 2004). Four years later, the Wall Street Journal reported that the number of affluent Asian Americans increased more than fivefold from 2002 to 2004. In the latter year, Asian Americans comprise 5 percent of all affluent (those with more than $500,000 of investible assets, excluding primary residence) Americans (Frank, 2004). By 2005, the Washington Post highlighted the emerging trend among brokerage firms to pursue wealthy Asian Americans as clients (White, 2005). Clearly, Asian Americans are among the nouveau riche, which is consistent with being a "model minority."

However, this picture of average wealth is an overly simplistic one that obscures the complexity within the population. Much of the debate around the “model minority” has focused on income (Ong et al, 1994). Income statistics show on the average Asian American households are fairing reasonably well. Nonetheless, there is more below the surface. The existing data show that even after adjusting for factors that influence wealth (for example, education, age, experience), Asian Americans face a racial gap relative to non-Hispanic Whites. The same issues may also be relevant in assessing wealth. In particular, where do Asian Americans stand on the wealth ladder? Are they faring as well as non-Hispanic Whites after adjusting for individual and household characteristics and how is wealth distributed among Asian Americans? Unfortunately, there is a paucity of information and studies addressing these questions.

To fill the lacuna in the literature on Asian American wealth this paper presents finding s from an analysis of available data and from other relevant studies. The first part examines the overall status of Asian American wealth compared to other major U.S. racial groups. Part II examines wealth distribution within the Asian American population and by Asian ethnicity. We then move to Part III to discuss the barriers to wealth accumulation for Asian Americans with a focus on lending in the housing market. In the last part, we return to a discussion about the larger issues that inform our analysis of Asian American wealth. In particular, we discuss the role of immigration policy in shaping the wealth distribution and outcomes.

In the conclusion, we explore the broader implications of our findings. One is that where a racial group stands on the wealth ladder and the other is how a group experiences the process of wealth accumulation differentially from non-Hispanic Whites—that racial inequality is defined in two conceptually independent ways. Even those Asian Americans who have achieved a level of socioeconomic status equal or beyond that of non-Hispanic Whites do not consistently display equal wealth outcomes. This mismatch threatens the very ideals that this country was based on and thus deserves more policy and planning attention.

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