Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/336587 
Year of Publication: 
2025
Series/Report no.: 
Discussion Paper No. 537
Publisher: 
Ludwig-Maximilians-Universität München und Humboldt-Universität zu Berlin, Collaborative Research Center Transregio 190 - Rationality and Competition, München und Berlin
Abstract: 
Why can elite families often maintain their social and economic status over multiple generations? We show that adoption can contribute to the persistence of elite status by utilizing a unique historical framework of prewar Japan. However, the preference for adopted heirs may lead to selection bias in the process of choosing heirs, potentially biasing OLS results negatively. To address this selection bias, we use the gender of the firstborn child as an instrument for the adoption decision. We find that having an adopted heir increases the probability of maintaining elite status in the son's generation by 27% compared to having a biological heir. Furthermore, we show that this result is driven by matching high-quality adopted sons with fathers who were highly successful in their early lives.
Subjects: 
ntergenerational transmission
Adoption
Succession
Family
Elite
JEL: 
J12
J13
J62
N35
Document Type: 
Working Paper

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