Household Finance at the Origin: Home Ownership as a Cultural Heritage from Agriculture

I show that home ownership decisions across countries and individuals are shaped by a cultural heritage from agriculture. For centuries, dominant assets in pre-industrial economies were either land or cattle. Consequently, the type of farming prevailing locally shaped preferences and believes about the relative value of immovable and movable assets. This cultural heritage had long-lasting consequences. Today, individuals originating from societies with a history of crop agriculture - where the dominant asset was land - are more likely to be homeowners. For identification, I rely both on home ownership decisions of second-generation immigrants in the US and on instrumental variables.