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The (Un)Importance of Inheritance

Author

Listed:
  • Sandra E Black
  • Paul J Devereux
  • Fanny Landaud
  • Kjell G Salvanes

Abstract

Transfers from parents—either in the form of gifts or inheritances—have received much attention as a source of inequality. This paper uses administrative data for the population of Norway to examine the share of the Total Inflows (defined as the capitalized sum of net labor income, government transfers, and gifts and inheritances received over the period) accounted for by capitalized gifts and inheritances. Consistent with other work, we find that there is much inequality in the receipt of gifts and inheritances. However, gifts and inheritances represent a small share of Total Inflows; this is true across the distribution of Total Inflows, as well as at all levels of net wealth. Gifts and inheritances are only an important source of income flows among those who have very wealthy parents. Additionally, gifts and inheritances have very little effect on the distribution of Total Inflows, suggesting that inheritance taxes may do little to mitigate inequality.

Suggested Citation

  • Sandra E Black & Paul J Devereux & Fanny Landaud & Kjell G Salvanes, 2025. "The (Un)Importance of Inheritance," Journal of the European Economic Association, European Economic Association, vol. 23(3), pages 1060-1094.
    • Handle: RePEc:oup:jeurec:v:23:y:2025:i:3:p:1060-1094.
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    File URL: http://hdl.handle.net/10.1093/jeea/jvae056
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    Cited by:

    1. is not listed on IDEAS
    2. Christophe Van Langenhove, 2025. "Wealth Mobility in the United States: Empirical Evidence from the PSID," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 25/1104, Ghent University, Faculty of Economics and Business Administration.
    3. Häner-Müller, Melanie & Salvi, Michele & Schaltegger, Christoph A., 2024. "Marry into new or old money? The distributional impact of marital decisions from an intergenerational perspective," Journal of Economic Behavior & Organization, Elsevier, vol. 224(C), pages 672-687.
    4. Lu, Kelin, 2024. "Silver Spoons and Scales of Justice: The Fairness Preference over Unequal Intergenerational Wealth Transfers," MPRA Paper 121451, University Library of Munich, Germany.
    5. Brian Nolan & Juan C. Palomino & Philippe Van Kerm & Salvatore Morelli, 2022. "Intergenerational wealth transfers in Great Britain from the Wealth and Assets Survey in comparative perspective," Fiscal Studies, John Wiley & Sons, vol. 43(2), pages 179-199, June.
    6. Joanna Tyrowicz & Krzysztof Makarski & Piotr Zoch, 2025. "Demographic transition and the rise of wealth inequality," GRAPE Working Papers 101, GRAPE Group for Research in Applied Economics.
    7. Javier Olivera & Warn N. Lekfuangfu & Philippe Van Kerm,, 2025. "Bequest Division: The Roles of Parental Motives and Children’s Gender Composition," Working Paper Research 476, National Bank of Belgium.
    8. Lu, Kelin, 2024. "Silver Spoons and Scales of Justice: The Fairness Preference over Unequal Intergenerational Wealth Transfers," MPRA Paper 121232, University Library of Munich, Germany.
    9. Schratzenstaller, Margit, 2025. "Behavioral responses to inheritance taxation – A review of the empirical literature," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 238-260.
    10. Lu, Kelin, 2025. "Silver spoons and scales of justice: The fairness preference over unequal intergenerational wealth transfers between Americans and Chinese," Journal of Economic Behavior & Organization, Elsevier, vol. 236(C).

    More about this item

    JEL classification:

    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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