Working Paper: NBER ID: w2154
Authors: Andrew B. Abel; Mark Warshawsky
Abstract: This paper analyzes the joy of giving bequest motive in which the utility obtained from leaving a bequest depends only on the size of the bequest. It exploits the fact that this formulation can be interpreted as a reduced form of an altruistic bequest motive to derive a relation between the value of the altruism parameter and the value of the joy of giving parameter. Using previous discussions of an a priori range of plausible values for the altruism parameter we then derive plausible restrictions on the joy of giving parameter. We demonstrate that this parameter may well be orders of magnitude larger than assumed in the existing literature.
Keywords: bequest motives; altruism; joy of giving; financial markets; wealth inequality
JEL Codes: D64; H31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| joy of giving bequest motive (D64) | altruistic motives (D64) |
| altruism parameter (D64) | joy of giving parameter (D64) |
| joy of giving parameter (D64) | macroeconomic outcomes (E66) |
| joy of giving bequest motive (D64) | financial markets (G10) |
| joy of giving bequest motive (D64) | wealth inequality (D31) |