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How inheriting affects bequest plans

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  • Stark, Oded
  • Nicinska, Anna

Abstract

We present and test the idea that bequest planning is linked with the experience of inheriting. We consider “a family tradition of bequeathing” as a channel through which the intention to bequeath is molded by and is positively correlated with the experience of inheriting. We use data from the Survey on Health, Ageing, and Retirement in Europe (SHARE) to test whether, other things held constant, inheriting has a positive influence on the intention to bequeath. We find that the experience of inheriting enhances the intension to bequeath as predicted by the family tradition model, independently of the positive impact of wealth. We also find that the expectation of inheriting has a positive impact on the intention to bequeath, controlling for the expected increase in wealth on account of future inheritances. Apparently, it is not the financial means that inheritance provides which account for its impact on the intention to bequeath; it is rather the family tradition of bequeathing instilled through inheriting.

Suggested Citation

  • Stark, Oded & Nicinska, Anna, 2015. "How inheriting affects bequest plans," Discussion Papers 208141, University of Bonn, Center for Development Research (ZEF).
  • Handle: RePEc:ags:ubzefd:208141
    DOI: 10.22004/ag.econ.208141
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    File URL: https://ageconsearch.umn.edu/record/208141/files/ZEFDP202.pdf
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    References listed on IDEAS

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    Cited by:

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    2. James R. Hines & Niklas Potrafke & Marina Riem & Christoph Schinke, 2019. "Inter vivos transfers of ownership in family firms," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(2), pages 225-256, April.
    3. Stefania Basiglio & Mariacristina Rossi & Arthur van Soest, 2019. "Subjective Inheritance Expectations and Economic Outcomes," Working papers 062, Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino.
    4. Dale R. DeBoer & Edward C. Hoang, 2017. "Inheritances and Bequest Planning: Evidence from the Survey of Consumer Finances," Journal of Family and Economic Issues, Springer, vol. 38(1), pages 45-56, March.
    5. Basiglio, Stefania, 2018. "Essays on financial behaviour of households and firms," Other publications TiSEM c13423c5-8bf2-44a7-baa7-3, Tilburg University, School of Economics and Management.
    6. Mengyuan Zhou, 2019. "The Effect of the Source of Inheritance on Bequest Attitudes: Evidence from Japan," Keio-IES Discussion Paper Series 2019-018, Institute for Economics Studies, Keio University.

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    More about this item

    Keywords

    Consumer/Household Economics; Institutional and Behavioral Economics;

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D19 - Microeconomics - - Household Behavior - - - Other
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household

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