Working Papers 

Uncertainty, Citizenship & Migrant Saving Choices [PDF]

Abstract: This paper studies how uncertainty over future location shapes saving choices. Using quasi-experimental variation in German citizenship law, I show that permanent migrants without a secure right to stay save 30% less than comparable natives. This gap --- which goes against the standard precautionary prediction --- is closed completely by access to citizenship. I show that in a life cycle framework with liquidation costs and country preferences, location uncertainty can depress saving by lowering expected future returns and marginal utility. Original survey data confirms that perceiving a greater risk to one's right to stay is associated with lower saving.