Based on the dataset of China's Comprehensive Social Survey (CGSS)

this paper systematically studies the effect of spontaneous Hukou transition on the diversity of their financial asset allocation. We find that spontaneous Hukou transition can significantly increase the diversity of financial asset allocation and optimize its structure. In order to solve the endogenous problems caused by the reverse causality as well as "self-selection" process

we further adopt the instrumental variable and propensity score matching method to analyze the treatment effect and obtain a consistent estimation. In addition

heterogeneity analysis illustrates the age differences within the above effects. Overall

this paper provides empirical evidence for the relation between the Hukou system and financial asset from a new perspective. We conclude that: easing Hukou restrictions and broadening the channels for asset allocation of rural groups are such important policies that it can significantly promote the integration of urban and rural residents in the New Era.