Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/25768 
Year of Publication: 
2006
Series/Report no.: 
CESifo Working Paper No. 1723
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
This paper examines the role of bequests and of taxation on bequests for the distribution of wealth. We investigate a model with overlapping generations and heterogenous households where parents derive utility directly from their bequests. Using the coefficient of variation as the measure of inequality, bequests per se diminish the inequality of wealth since they raise private savings and hence average wealth holdings more than the variance of wealth. From a policy perspective, taxing bequests and redistributing government revenue lump-sum among the young generation further decreases wealth inequality.
JEL: 
D31
H23
Document Type: 
Working Paper
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