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The research community at the Institute includes visiting scholars, consultants, economists, research analysts, and research assistants. These scholars bring varied backgrounds, interests, and expertise to research that deepens our understanding of economic opportunity and inclusion as well as policies that work to improve both.
Culture, history, uncertainty—all affect how we invest our money. How we invest determines our returns. And those returns can expand or erode the wealth gaps in society.
This chain runs though the work of Institute visiting scholar Chi Hyun Kim, whose globe-spanning childhood inspires her research at the intersection of culture, history, and finance. In her birth country of South Korea, for example, Kim says investors have a taste for speculative investments like Bitcoin. But in Germany, her home from age 15, Kim’s research shows how a national investing “trauma”—the crash of shares of Deutsche Telekom that had been heavily touted to the public—still makes investors wary of stocks a quarter century later.
“When I started my Ph.D., I was trying to understand the role of heterogeneity and transmission mechanisms of monetary policy,” Kim said. This led to “thinking about heterogeneous portfolio choices—people making different decisions based on their socioeconomic backgrounds.” An early project looked at women and men, finding that women are more reluctant to enter the stock market after a monetary contraction.
During her time at the Institute, Kim launched her latest research on the sources of investment decisions: Do regional differences in housing markets—say, the relative stability of Minneapolis versus the volatility of Phoenix—affect investors’ risk appetites?
Kim also continues to add to her stream of research into the Black-White wealth gap in the U.S. Her latest Institute working paper explores the kind of investing puzzle that fascinates her: Why are Black Americans seemingly underinvested in stocks?
“The stock market has been flourishing since the 1980s, and Black households have been missing out on capital gains,” Kim said. Kim and her co-authors find Black investors make rational decisions to take less risk in the stock market given their higher level of risk in the labor market. “You have a high exposure to risk of losing your job and your wealth at the same time,” Kim said. One implication: Until we address underlying labor market discrepancies, “just increasing financial inclusion is not enough.”
The paper extends Kim’s ongoing collaboration with co-authors to assemble historical data on the racial wealth gap. They have unveiled the narrowing of the gap after the Civil War, the stalled progress since the 1970s, and how we still reckon today with the enormous gap at the end of slavery.
They are now at work on their fourth paper together. “Since we are covering 150 years of data,” Kim said, “we’ve had so many ideas we want to address.”
This article is featured in the Spring 2025 issue of For All, the magazine of the Opportunity & Inclusive Growth Institute
More scholar spotlights from this issue
Remembering Natalie Gubbay
Karen Kopecky—Unpacking dysfunction in long-term care insurance
Lukas Mann—Messy realities, macroeconomic consequences
Jeff Horwich is the senior economics writer for the Minneapolis Fed. He has been an economic journalist with public radio, commissioned examiner for the Consumer Financial Protection Bureau, and director of policy and communications for the Minneapolis Public Housing Authority. He received his master’s degree in applied economics from the University of Minnesota.
