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Bequests, estate taxes, and wealth distributions

Author

Listed:
  • Jing Wan

    (Tianjin University)

  • Shenghao Zhu

    (Beihang University)

Abstract

Bossmann et al. (J Public Econ 91:1247–1271, 2007) found that estate taxes reduce the long-run wealth inequality. This result contrasts with the findings of the previous literature with idiosyncratic labor efficiency risk. We use a decomposition technique, developed by Davies (J Labor Econ 4:538–559, 1986), to reinvestigate the impact of estate taxes on the long-run wealth inequality. We find that the different results of estate taxes are due to the different redistribution effects.

Suggested Citation

  • Jing Wan & Shenghao Zhu, 2019. "Bequests, estate taxes, and wealth distributions," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 67(1), pages 179-210, February.
    • Handle: RePEc:spr:joecth:v:67:y:2019:i:1:d:10.1007_s00199-017-1091-7
    DOI: 10.1007/s00199-017-1091-7
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    References listed on IDEAS

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    3. Fischer, Thomas, 2019. "Determinants of Wealth Inequality and Mobility in General Equilibrium," Working Papers 2019:22, Lund University, Department of Economics.

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    More about this item

    Keywords

    Wealth inequality; Bequest motives; Estate taxes; Lorenz dominance;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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