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The equal division puzzle – empirical evidence on intergenerational transfers in Sweden

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  • Ohlsson, Henry

    (Department of Economics)

Abstract

The objective of this paper is to study to what extent parents divide their estates unequally between their children. Unequal sharing of parental transfers is, for example, a necessary condition for theories of altruistic (dynastic) behavior to hold. I use a new data set based on the estate reports for 230 widows, widowers, and divorcees from the city of Stockholm, Sweden deceased in 2004. Unequal sharing is unusual, depending on definitions only 7–25 percent of the estates are unequally divided. The data set is also used to estimate probit models for the likelihood of unequal sharing. A first main result is that the probability of unequal sharing is increasing in the size of the estate. Second, the older the children are on average the more likely is unequal sharing. Finally, unequal sharing is more common among deceased from some neighborhoods of the city compared to deceased from other neighborhoods.

Suggested Citation

  • Ohlsson, Henry, 2007. "The equal division puzzle – empirical evidence on intergenerational transfers in Sweden," Working Paper Series 2007:10, Uppsala University, Department of Economics.
    • Handle: RePEc:hhs:uunewp:2007_010
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    6. B. Douglas Bernheim & Sergei Severinov, 2003. "Bequests as Signals: An Explanation for the Equal Division Puzzle," Journal of Political Economy, University of Chicago Press, vol. 111(4), pages 733-764, August.
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Elinder Mikael & Erixson Oscar & Ohlsson Henry, 2012. "The Impact of Inheritances on Heirs' Labor and Capital Income," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 12(1), pages 1-37, December.
    2. Andrew Ellul & Marco Pagano & Fausto Panunzi, 2010. "Inheritance Law and Investment in Family Firms," American Economic Review, American Economic Association, vol. 100(5), pages 2414-2450, December.
    3. Ctirad Slavik & Kevin Wiseman, 2018. "Tough Love for Lazy Kids: Dynamic Insurance and Equal Bequests," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 27, pages 64-80, January.
    4. Ohlsson, Henry, 2007. "The legacy of the Swedish gift and inheritance tax, 1884–2004," Working Paper Series 2007:23, Uppsala University, Department of Economics.
    5. Erixson, Oscar & Ohlsson, Henry, 2014. "Estate division: Equal sharing as choice, social norm, and legal requirement," Working Paper Series, Center for Fiscal Studies 2014:2, Uppsala University, Department of Economics.
    6. Katarina Nordblom & Henry Ohlsson, 2011. "Bequests, gifts, and education: links between intergenerational transfers," Empirical Economics, Springer, vol. 40(2), pages 343-358, April.
    7. Oscar Erixson & Henry Ohlsson, 2019. "Estate division: equal sharing, exchange motives, and Cinderella effects," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(4), pages 1437-1480, October.
    8. Elinder, Mikael & Erixson, Oscar & Escobar, Sebastian & Ohlsson, Henry, 2014. "Estates, bequests, and inheritances in Sweden - A look into the Belinda databases," Working Paper Series, Center for Fiscal Studies 2014:14, Uppsala University, Department of Economics.
    9. Junya Hamaaki & Masahiro Hori & Keiko Murata, 2019. "The intra-family division of bequests and bequest motives: empirical evidence from a survey on Japanese households," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(1), pages 309-346, January.
    10. Ohlsson, Henry, 2007. "Tax avoidance - a natural experiment," Working Paper Series 2007:13, Uppsala University, Department of Economics.
    11. Kevin Wiseman & Ctirad Slavık, 2009. "Tough Love For Lazy Kids," 2009 Meeting Papers 1091, Society for Economic Dynamics.

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    More about this item

    Keywords

    bequests; inheritances; equal division; altruism;
    All these keywords.

    JEL classification:

    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • D10 - Microeconomics - - Household Behavior - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

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