Scandinavian Working Papers in Economics
Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy
No 2018:8: Intergenerational wealth mobility and the role of inheritance: Evidence from multiple generations
Adrian Adermon (), Mikael Lindahl () and Daniel Waldenström ()
Additional contact information
Adrian Adermon: IFAU - Institute for Evaluation of Labour Market and Education Policy, Postal: Institute for Evaluation of Labour Market and Education Policy, P O Box 513, SE-751 20 Uppsala, Sweden
Mikael Lindahl: Department of Economics, University of Gothenburg, Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Vasagatan 1, P.O. Box 640,, SE 405 30, Gothenburg,, Sweden
Daniel Waldenström: Paris School of Economics, Postal: Paris School of Economics, , 48 Boulevard Jourdan, , 75014 Paris, , France.
Abstract: This study estimates intergenerational correlations in mid-life wealth across three generations, and a young fourth generation, and examines how much of the parent-child association that can be explained by inheritances. Using a Swedish data set we find parent-child rank correlations of 0.3–0.4 and grandparents-grandchild rank correlations of 0.1–0.2. Conditional on parents’ wealth, grandparents’ wealth is weakly positively associated with grandchild’s wealth and the parent-child correlation is basically unchanged if we control for grandparents’ wealth. Bequests and gifts strikingly account for at least 50 per cent of the parent-child wealth correlation while earnings and education are only able to explain 25 per cent.
Keywords: multigenerational mobility; bequests; mid-life wealth
56 pages, May 9, 2018
Full text files
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