Minority banking and the logic of reinvestment in racialized urban space: Migration, housing, and finance in pre- and post-crisis California

Authors: Melody Chiong*, University of California, San Diego, Gary Dymski, University of Leeds, Jesus Hernandez, University of California, Davis
Topics: Urban Geography, Urban and Regional Planning, Ethnic Geography
Keywords: ethnic banking, black geographies, economic development, housing finance, immigration, ethnoburbs, political economy
Session Type: Paper
Day: 4/10/2018
Start / End Time: 4:40 PM / 6:20 PM
Room: St. Charles, Marriott, River Tower Elevators, 41st Floor
Presentation File: No File Uploaded


Recent research on the geography of urban space highlights the impact of transnational finance on local economies: global elites use global-city housing as “safe deposit boxes” (Fernandez, Hofman, and Aalbers 2016)), in purchases that form part of a global “wall of money” (Fernandez and Aalbers 2016). These contributions leave open some key questions taken up here: how do transnational capital and immigration flows involving non-elite households affect local housing markets and economies characterized by racial/ethnic diversity? And do these trends affect the intermediaries channeling flows of capital and credit for racial/ethnic minorities (including immigrants) – and in particular, ethnic banks?

This paper shows that non-elite immigration indeed transforms local markets, in ways that reflect and even amplify historical patterns of social exclusion and economic inequality. Los Angeles provides a case study of the intersection of cross-border immigration and capital flows with embedded patterns of racial/ethnic inequality and segregation. We build on and extend prior work on Los Angeles’ Asian ethnoburbs (Li 1998), on Asian immigrant networks (Zhou 1998), and on racial/ethnic inequality in access to mortgage finance (Dymski and Mohanty 2001 and Hernandez 2006). We show how African-American and Asian-American banks have necessarily followed two very different “logics of reinvestment” (Chiong 2014), due to the differential immigration and cross-border capital flows in the communities they serve. Sustained influxes of capital and immigrants have permitted Asian-American banks and communities to thrive, while other ethnic banks must take more cautious approaches in communities whose wealth accumulation and economic reproduction processes remain fragile.

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