Born in the land of milk and honey: The impact of economic growth on individual wealth accumulation

Charlotte Bartels, Johannes König and Carsten Schröder

VfS Annual Conference 2021 (Virtual Conference): Climate Economics from Verein für Socialpolitik / German Economic Association

Abstract: Economic growth varies substantially across regions and over time. This paper shows that economic growth in a person's birth place is an important determinant for wealth in adulthood. We exploit a new dataset that oversamples wealthy individuals in Germany and includes information on birth district, current residence, individual wealth, gifts and inheritances and parental background. To identify the effect of economic growth on children's wealth we match the population of heirs to statistically equivalent non-heirs. We use regression analysis to determine the effect of regional economic growth on this inherited fraction of wealth. At an average level of GDP at birth, a one standard deviation higher per capita GDP growth at birth increases wealth in adulthood by roughly 130,000 Euro.

Keywords: wealth distribution; regional inequality; intergenerational transmission (search for similar items in EconPapers)
JEL-codes: D31 D64 O47 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-fdg, nep-gro and nep-his
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc21:242398

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