David Miles, 06 December 2018

Paula Gobbi, Marc Goñi, 28 April 2018

We know inheritance practices have an impact on inequality, social mobility, and economic growth, but the effect on fertility decisions has often been ignored even though such decisions can affect the economic impact of inheritance. This column uses data on the British aristocracy to provide evidence of the two-way link between inheritance and fertility decisions on the extensive margin. This allows us to understand modern inheritance practices, such as trusts, that restrict successors.

Adrian Adermon, Mikael Lindahl, Daniel Waldenström, 27 November 2016

Recent studies on intergenerational income mobility have looked beyond the two-generational model to the role of grandparents, but multigenerational patterns in the wealth distribution have received less attention. This column uses a Swedish four-generational wealth dataset to study the role of family background for people’s wealth status and how much of this that is due to material inheritance. Most of the transmission in wealth status between generations comes from parents in the form of bequests and gifts, with only a marginal contribution from grandparents. 

Mikael Elinder, Oscar Erixson, Daniel Waldenström, 20 April 2016

The distributional effect of inherited wealth has been a long-standing question in economics. This column presents new evidence on the issue using population-wide register data from Sweden. The findings show that inheritances decrease wealth inequality but increase the absolute dispersion of wealth. The equalising effect of inheritances is diluted, however, by the fact that less wealthy heirs consume most of their inherited wealth, whereas wealthier heirs tend to save theirs. 

Simon Boserup, Wojciech Kopczuk, Claus Thustrup Kreiner, 11 March 2016

It is often suggested that intergenerational bequests such as inheritances create and perpetuate wealth inequality. This column uses Danish data to explore the effects of bequests on the wealth distribution. While bequests are found to increase the dispersion of absolute wealth inequality, relative inequality declines. These findings suggest that inheritance alone need not increase wealth inequality.

Jesper Roine, Henry Ohlsson, Daniel Waldenström, 08 August 2014

The extent to which lifetime incomes are determined by inherited wealth is a politically sensitive issue, but long-run evidence on this question is limited. This column presents evidence on Swedish inheritance flows since the early 19th century. Despite a long history of aristocracy, accumulated capital was small relative to income in pre-industrial Sweden. In more recent times, Sweden stands out as a country where the return of capital has not automatically translated into a return of inherited wealth.

Natalie Chen, Paola Conconi, Carlo Perroni, 10 October 2011

Victorian novelist Horatio Alger insisted that hard work and a bit of luck could whisk a boy from rags to riches. CEPR DP8605 outlines a model to measure how social mobility impacts men and women differently. The authors suggest that, paradoxically, women's historically higher social mobility may be due to labour market discrimination--and that reducing the gender wage gap may reduce social mobility overall.

Graziella Bertocchi, 15 July 2007

Inheritance tax revenues have long been declining in all OECD countries, both in terms of total revenues and GDP. This trend is explained by the secular decline of wealth inequality, and is also influenced by differential rates of tax avoidance and by the evolving composition of wealth.

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