The inherited inequality: How demographic aging and pension reforms can change the intergenerational transmission of wealth

Justina Klimaviciute, Harun Onder and Pierre Pestieau

No 2018008, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: The role of inherited wealth in modern economies has increasingly come under scrutiny. This study presents one of the first attempts to shed light on how demographic aging could shape this role. It shows that, in the absence of retirement annuities, or for a given level of annuitization, both increasing longevity and decreasing fertility should reduce the inherited share of total wealth in a given economy. Thus, aging is not likely to explain a recent surge in this share in some advanced economies. Shrinking retirement annuities, however could offset and potentially reverse these effects. The paper also shows that individual bequests will be more unequally distributed if aging is driven by a drop in fertility. In comparison, the effect of increasing longevity on their distribution is non-monotonic.

Keywords: inherited wealth; inheritance; aging; inequality; social security (search for similar items in EconPapers)
JEL-codes: D14 D31 D64 D91 E21 H55 J11 (search for similar items in EconPapers)
Date: 2018-03-16
New Economics Papers: this item is included in nep-age, nep-dem and nep-mac
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Related works:
Working Paper: The inherited inequality: How demographic aging and pension reforms can change the intergenerational transmission of wealth (2020)
Journal Article: The Inherited Inequality: How Demographic Aging and Pension Reforms can Change the Intergenerational Transmission of Wealth (2019)
Journal Article: The Inherited Inequality: How Demographic Aging and Pension Reforms can Change the Intergenerational Transmission of Wealth (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:cor:louvco:2018008

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