De Nardi, M;
Yang, F;
(2014)
Bequests and heterogeneity in retirement wealth.
EUROPEAN ECONOMIC REVIEW
, 72
182 - 196.
10.1016/j.euroecorev.2014.09.004.
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Abstract
Households hold vastly heterogeneous amounts of wealth when they reach retirement, and differences in lifetime earnings explain only part of this variation. This paper studies the role of intergenerational transmission of ability, voluntary bequest motives, and the recipiency of accidental and intended bequests (both in terms of timing and size) in generating wealth dispersion at retirement, in the context of a rich quantitative model. Modeling voluntary bequests, and realistically calibrating them, not only generates more wealth dispersion at retirement and reduces the correlation between retirement wealth and lifetime income, but also generates a skewed bequest distribution that is close to the one in the observed data.
| Type: | Article |
|---|---|
| Title: | Bequests and heterogeneity in retirement wealth |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.1016/j.euroecorev.2014.09.004 |
| Publisher version: | http://dx.doi.org/10.1016/j.euroecorev.2014.09.004 |
| Additional information: | Copyright © 2014 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license |
| Keywords: | Wealth inequality, Retirement, Earnings shocks, Bequest, Social Security |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL SLASH UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS > Dept of Economics |
| URI: | https://discovery.ucl.ac.uk/id/eprint/1465088 |
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