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How inheritances shape wealth distributions: An international comparison

Author

Listed:
  • Bönke, Timm
  • von Werder, Marten
  • Westermeier, Christian

Abstract

We use data from the European Household Finance and Consumption Survey in order to examine the distributional effect of intergenerational wealth transfers on the net worth distribution in 8 European countries and compare it to recent findings for the US. To do so, we resort to the decomposition of the coefficient of variation as suggested and applied by Wolff (1987, 2002, 2015) and Wolff and Gittleman (2014). The results hint that inheritances and gifts have a vastly equalizing effect on inequality in household wealth in all 8 countries.

Suggested Citation

  • Bönke, Timm & von Werder, Marten & Westermeier, Christian, 2016. "How inheritances shape wealth distributions: An international comparison," Discussion Papers 2016/26, Free University Berlin, School of Business & Economics.
    • Handle: RePEc:zbw:fubsbe:201626
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    Cited by:

    1. Schechtl, Manuel & Waitkus, Nora, 2024. "Where income becomes wealth: how redistribution moderates the association between income and wealth," LSE Research Online Documents on Economics 124574, London School of Economics and Political Science, LSE Library.
    2. Julio López-Laborda, 2024. "Does the Inheritance and Gift Tax reduce wealth inequality? It depends," Working Papers 2024-06, FEDEA.
    3. Sommer, Eric, 2017. "Wealth Transfers and Tax Planning: Evidence for the German Bequest Tax," IZA Discussion Papers 11120, Institute of Labor Economics (IZA).
    4. Lawless, Martina & Lynch, Donal, 2017. "Gifts and inheritances in Ireland," Papers WP579, Economic and Social Research Institute (ESRI).
    5. Elinder, Mikael & Erixson, Oscar & Waldenström, Daniel, 2018. "Inheritance and wealth inequality: Evidence from population registers," Journal of Public Economics, Elsevier, vol. 165(C), pages 17-30.
    6. Charlotte Bartels & Carsten Schroeder, 2020. "The role of rental income, real estate and rents for inequality in Germany," Working Papers 7, Forum New Economy.
    7. Berenice Anne Neumann & Niklas Scheuer, 2024. "The Impact of Bequest Taxation on Wealth Inequality - Theory and Evidence," Research Papers in Economics 2024-05, University of Trier, Department of Economics.
    8. von Werder, Marten, 2018. "Intergenerational transfers: How do they shape the German wealth distribution?," Discussion Papers 2018/15, Free University Berlin, School of Business & Economics.
    9. Manuel Schechtl & Nora Waitkus, 2024. "Where Income becomes Wealth: How Redistribution Moderates the Association between Income and Wealth," LWS Working papers 45, LIS Cross-National Data Center in Luxembourg.
    10. Morelli, Salvatore & Nolan, Brian & Palomino, Juan C. & Van Kerm, Philippe, 2025. "Corrigendum to “The influence of inheritances on wealth inequality in rich countries”. [J. Public Econ. 247 (2025) 105398]," Journal of Public Economics, Elsevier, vol. 252(C).
    11. Stefan Jestl, 2021. "Inheritance tax regimes: a comparison," Public Sector Economics, Institute of Public Finance, vol. 45(3), pages 363-385.
    12. Nolan, Brian & Palomino, Juan C. & Van Kerm, Philippe & Morelli, Salvatore, 2021. "Intergenerational wealth transfers and wealth inequality in rich countries: What do we learn from Gini decomposition?," Economics Letters, Elsevier, vol. 199(C).
    13. Simone Arrigoni & Laura Boyd & Tara McIndoe-Calder, 2025. "The long and the short of it: inheritance and wealth in Ireland," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 23(1), pages 119-142, March.
    14. Stefan Jestl, 2018. "Inheritance tax regimes," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 176, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    15. Bavaro, Michele & Boscolo, Stefano & Tedeschi, Simone, 2024. "Simulating Long-Run Wealth Distribution and Transmission: The Role of Intergenerational Transfers," INET Oxford Working Papers 2024-01, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.
    16. Dominik Bernhofer & Michael Ertl & Petra Innreiter & Pascal Schraml & Eva Six & Max Wehsely, 2024. "Ausgestaltung und Herausforderungen einer modernen Erbschafts- und Schenkungssteuer in Österreich," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 50(1), pages 43-81.
    17. Martin Beznoska & Tobias Hentze & Maximilian Stockhausen, 2020. "The inheritance and gift tax in Germany: Reform potentials for tax revenue, efficiency and distribution," Public Sector Economics, Institute of Public Finance, vol. 44(3), pages 385-417.

    More about this item

    Keywords

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

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