Advanced Search
MyIDEAS: Login to save this article or follow this journal

Optimal Taxation of Wealth Transfers When Bequests are Motivated by Joy of Giving

Contents:

Author Info

  • Brunner Johann K.

    ()
    (Johannes Kepler University of Linz)

  • Pech Susanne

    ()
    (Johannes Kepler University of Linz)

Abstract

Inherited wealth creates a second distinguishing characteristic of individuals, in addition to earning abilities. We incorporate this fact into a model of optimal labor-income taxation, with bequests motivated by joy of giving. We find that taxes on bequests or on inheritances allow further redistribution if, in the parent generation, initial wealth and earning abilities are positively related. However, these taxes distort the bequest decision and thus, the overall effect on social welfare is ambiguous. On the other hand, a tax on all expenditures of a generation (a uniform tax on consumption plus bequests) has the same redistributive effect as an inheritance tax but does not distort the bequest decision.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.degruyter.com/view/j/bejeap.2012.12.issue-1/1935-1682.3070/1935-1682.3070.xml?format=INT
Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 12 (2012)
Issue (Month): 1 (March)
Pages: 1-22

as in new window
Handle: RePEc:bpj:bejeap:v:12:y:2012:i:1:n:8

Contact details of provider:
Web page: http://www.degruyter.com

Order Information:
Web: http://www.degruyter.com/view/j/bejeap

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. BOADWAY, Robin & MARCHAND, Maurice & PESTIEAU, Pierre, 1997. "Redistribution with unobservable bequests: a case for taxing capital income," CORE Discussion Papers 1997070, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Barro, Robert J, 1974. "Are Government Bonds Net Wealth?," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1095-1117, Nov.-Dec..
  3. Wojciech Kopczuk & Joseph P. Lupton, 2004. "To leave or not to leave: the distribution of bequest motives," Finance and Economics Discussion Series 2004-33, Board of Governors of the Federal Reserve System (U.S.).
  4. Johann Brunner & Paul Eckerstorfer & Susanne Pech, 2013. "Optimal taxes on wealth and consumption in the presence of tax evasion," Journal of Economics, Springer, vol. 110(2), pages 107-124, October.
  5. Johann K. Brunner & Susanne Pech, 2008. "Optimum Taxation of Inheritances," CESifo Working Paper Series 2319, CESifo Group Munich.
  6. Cremer, Helmuth & Pestieau, Pierre & Rochet, Jean-Charles, 1999. "Capital Income Taxation when Inherited wealth is not Observable," IDEI Working Papers 109, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2001.
  7. CREMER, Helmuth & PESTIEAU, Pierre, . "Wealth transfer taxation: a survey of the theoretical literature," CORE Discussion Papers RP -1874, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  8. Johann K. Brunner & Susanne Pech, 2012. "Optimal Taxation of Bequests in a Model with Initial Wealth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1368-1392, December.
  9. Webley,Paul & Robben,Henry & Elffers,Henk & Hessing,Dick (ed.), 2010. "Tax Evasion," Cambridge Books, Cambridge University Press, number 9780521130615, April.
  10. Wojciech Kopczuk, 2010. "Economics of estate taxation: a brief review of theory and evidence," NBER Working Papers 15741, National Bureau of Economic Research, Inc.
  11. Atkinson, A. B. & Stiglitz, J. E., 1976. "The design of tax structure: Direct versus indirect taxation," Journal of Public Economics, Elsevier, vol. 6(1-2), pages 55-75.
  12. Emmanuel Farhi & Iván Werning, 2010. "Progressive Estate Taxation," The Quarterly Journal of Economics, MIT Press, vol. 125(2), pages 635-673, May.
  13. Mirrlees, James A, 1971. "An Exploration in the Theory of Optimum Income Taxation," Review of Economic Studies, Wiley Blackwell, vol. 38(114), pages 175-208, April.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Johann K. Brunner & Susanne Pech, 2012. "Optimal Taxation of Bequests in a Model with Initial Wealth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1368-1392, December.
  2. Johann K. Brunner, 2012. "The Bequest Tax as Long-Term Care Insurance," CESifo Working Paper Series 3901, CESifo Group Munich.
  3. Johann K. Brunner & Susanne Pech, 2013. "Taxing Bequests and Consumption in the Steady State," CESifo Working Paper Series 4453, CESifo Group Munich.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:bpj:bejeap:v:12:y:2012:i:1:n:8. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.