Random earnings differences, lifetime liquidity constraints, and altruistic intergenerational transfers

Laitner, John

doi:10.1016/0022-0531(92)90051-i

Cited by 144 publications

(110 citation statements)

References 27 publications

Supporting

Mentioning

109

Contrasting

Order By: Relevance

“…For example, the theoretical and simulation work of Oulton (1976) and Laitner (1992) indicate the impossibility of reconciling the two distributions without also assuming an unequal distribution of bequests.…”

Section: Introductionmentioning

confidence: 99%

Inheritances and the distribution of wealth or whatever happened to the great inheritance boom?

Wolff

Gittleman

2013

J Econ Inequal

View full text Add to dashboard Cite

Abstract:We found that on average over the period from 1989 to 2007, 21 percent of American households at a given point of time received a wealth transfer and these accounted for 23 percent of their net worth. Over the lifetime, about 30 percent of households could expect to receive a wealth transfer and these would account for close to 40 percent of their net worth near time of death. However, there is little evidence of an inheritance "boom." In fact, from 1989 to 2007, the share of households reporting a wealth transfer fell by 2.5 percentage points. The average value of inheritances received among all households did increase but at a slow pace, by 10 percent, and wealth transfers as a proportion of current net worth fell sharply over this period from 29 to 19 percent or by 10 percentage points. We also found, somewhat surprisingly, that inheritances and other wealth transfers tend to be equalizing in terms of the distribution of household wealth. Indeed, the addition of wealth transfers to other sources of household wealth has had a sizeable effect on reducing the inequality of wealth. JEL Codes: D31, J15

show abstract

Section: Introductionmentioning

confidence: 99%

Inheritances and the distribution of wealth or whatever happened to the great inheritance boom?

Wolff

Gittleman

2013

J Econ Inequal

View full text Add to dashboard Cite

show abstract

“…Ž . examples of these models are Loury 1981 andLaitner 1992 . The other type incorporates the fertility decision explicitly into the dynastic household model.…”

Section: Introductionmentioning

confidence: 99%

Social Mobility: The Barro–Becker Children Meet the Laitner–Loury Dynasties

Álvarez

1999

Review of Economic Dynamics

View full text Add to dashboard Cite

“…We assume that parents and children have the same objective function during the periods when their lives overlap (as in Laitner (1992)). Because of this commonality of interests, during the periods when their lives overlap the parent and the children constitute a single decision unit by pooling their resources.…”

Section: Dynastic Model: Households'decision Problemmentioning

confidence: 99%

Altruism, incomplete markets, and tax reform

Fuster

İmrohoroğlu

2008

Journal of Monetary Economics

View full text Add to dashboard Cite

We compute the welfare e¤ects of di¤erent revenue-neutral tax reforms that eliminate capital income taxation in a general equilibrium model calibrated to the U.S. economy. We …nd that the reform with the largest welfare gain is the one that eliminates all income taxation and increases the consumption tax to 35%. In our calibrated dynastic economy, 75% of the population alive at the time of the reform bene…t from it. Altruism plays an important role in this result. Individuals use intervivos transfers and bequests to redistribute the long-run bene…ts in the form of higher after-tax wages and interest rates that will bene…t future generations toward the current generations. Indeed, in a pure life-cycle economy calibrated to the same U.S. observations, we …nd that the same reform would bene…t only 9% of the population. The increase in the consumption tax at the initial period of the transition hurts all individuals except for the very young workers. Since generations are not linked by private transfers, the e¢ -ciency gains of this reform are only enjoyed by generations born in the very far future. A popular tax reform in the pure life-cycle model is one that bene…ts current generations regardless of the impact on future generations. For instance, the elimination of capital income taxation …nanced with an increase in the wage tax bene…ts 63% of the population living at the time of the reform but decreases welfare in the long-run. Abstract

show abstract

Random earnings differences, lifetime liquidity constraints, and altruistic intergenerational transfers

Cited by 144 publications

References 27 publications

Inheritances and the distribution of wealth or whatever happened to the great inheritance boom?

Inheritances and the distribution of wealth or whatever happened to the great inheritance boom?

Social Mobility: The Barro–Becker Children Meet the Laitner–Loury Dynasties

Altruism, incomplete markets, and tax reform

Contact Info

Product

Resources

About