Wealth Distribution and Optimal Inheritance Taxation in Life‐cycle Economies with Intergenerational Transfers

Burkhard Heer

Scandinavian Journal of Economics, 2001, vol. 103, issue 3, 445-465

Abstract: Intergenerational transfers are introduced into a general equilibrium life‐cycle model in order to explain observed levels of wealth heterogeneity. In our overlapping generations model, heterogenous agents face uncertain lifetime and leave both accidental and voluntary bequests to their children. Furthermore, agents face stochastic employment opportunities. The model is calibrated with regard to the characteristics of the US economy. Our results indicate that bequests only account for a small proportion of observed wealth heterogeneity. The introduction of an inheritance tax increases both welfare, as measured by the average lifetime utility of a newborn, and equality of the wealth distribution. JEL classification: D31; D91; H21; C68; E21

Date: 2001
References: Add references at CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
https://doi.org/10.1111/1467-9442.00254

Related works:
Working Paper: Wealth Distribution and Optimal Inheritance Taxation in Life-Cycle Economies with Intergenerational Transfers (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:scandj:v:103:y:2001:i:3:p:445-465

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0347-0520

Access Statistics for this article

Scandinavian Journal of Economics is currently edited by Richard Friberg, Matti Liski and Kjetil Storesletten

More articles in Scandinavian Journal of Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().