Working Paper: NBER ID: w12569
Authors: David Joulfaian
Abstract: This paper explores the effects of inheritances on the saving of recipients. Information on inheritances and heirs is obtained from estate tax records of decedents which are linked to the income tax records of beneficiaries. The observed pattern of wealth mobility within two years of the receipt of inheritances and multivariate analyses show that wealth increases by less than the full amount of the inheritance received. Similarly, and consistent with previous findings, large inheritances are found to depress labor force participation.
Keywords: inheritance; saving; wealth mobility; labor supply
JEL Codes: E21; H31; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| inheritances (D14) | wealth accumulation (E21) |
| inheritances (D14) | marginal propensity to consume (MPC) (E21) |
| inheritances (D14) | labor force participation (J22) |
| wealth accumulation (E21) | labor force participation (J22) |