Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/70815
Authors: 
Stark, Oded
Zhang, Junsen
Year of Publication: 
2000
Series/Report no.: 
Reihe Ökonomie / Economics Series, Institut für Höhere Studien (IHS) 82
Abstract: 
The intersection of the standard altruism hypothesis with the quite strong evidence that bequests tend to be equal suggests that inter-vivos transfers should be strongly compensatory. Yet the available evidence is not in congruence with this implication. It has therefore been inferred that the motive underlying inter-vivos transfers is not parental altruism. In this paper we present an argument showing why parents who are equally altruistic toward their children optimally transfer more to the child whose earnings are higher. We show that rather than being orthogonal to parental altruism, counter-compensating transfers emanate from such altruism. A key point in the analysis is that parents and children are interlinked in a rich web of (vertical and possibly horizontal) transfers, reverse transfers, direct transfers, and indirect transfers.
Subjects: 
parental altruism
inter-vivos transfers
JEL: 
D10
D31
D63
D64
Document Type: 
Working Paper

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