The effectiveness of immigrant integration policies has gained considerable attention across Western democracies dealing with ethnically and culturally diverse societies. However, the findings on what type of policy produces more favourable integration outcomes remain inconclusive. The conflation of normative and analytical assumptions on integration is a major challenge for causal analysis of integration policies. This article applies actor-centered institutionalism as a new framework for the analysis of immigrant integration outcomes in order to separate two different mechanisms of policy intervention. Conceptualising integration outcomes as a function of capabilities and aspirations allows separating assumptions on the policy intervention in assimilation and multiculturalism as the two main types of policy approaches. The article illustrates that assimilation is an incentive-based policy and primarily designed to increase immigrants' aspirations, whereas multiculturalism is an opportunity-based policy and primarily designed to increase immigrants' capabilities. Conceptualising causal mechanisms of policy intervention clarifies the link between normative concepts of immigrant integration and analytical concepts of policy effectiveness.