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A Flying Start intergenerational Transfers , Wealth Accumalation, and Entrepreneurship of Descendants

Author

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  • Elin Colmsjoe

    (Department of Economics, University of Copenhagen)

Abstract

Early wealth transfers are growing relative to inheritances, yet their effects on inequality remain poorly understood. I identify large wealth transfers tied to housing market entries by exploiting a Danish tax policy that allows parents to sell housing to their children below market value, and study their effects on recipients investments and wealth. I find that transfers increase the likelihood of starting a business over the next decade while also raising consumption. Instrumenting transfer amounts with a policy-determined cap maintains significant investment responses, indicating that transfers directly support wealth accumulation by shaping financial choices early in life. Effects are strongest among recipients outside the top of parental wealth, suggesting that the business-investment channel promotes intergenerational mobility.

Suggested Citation

  • Elin Colmsjoe, 2025. "A Flying Start intergenerational Transfers , Wealth Accumalation, and Entrepreneurship of Descendants," CEBI working paper series 24-02, University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI).
    • Handle: RePEc:kud:kucebi:2402
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    File URL: https://www.econ.ku.dk/cebi/publikationer/working-papers/CEBI_WP_02-24.Rev2026.pdf
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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