Abstract
This study contributes to the empirical literature testing bequest motives by using a population-wide administrative dataset, covering data on inherited amounts for complete families matched with an extensive set of economic and demographic variables, to estimate the influence of child characteristics on differences in inherited amounts among siblings. Our main findings are, first, children who are more likely to have provided services to the parent receive more than their siblings, as predicted by the exchange model. Second, daughters with children receive more than sons with children. This is consistent with the prediction of the evolutionary model that larger investments should go to offspring who are certain to be genetically related. There are also Cinderella effects—that is, adopted stepchildren receive less than siblings who are biological or children who are adopted by both parents. Third, we do not find support for the prediction of the altruism model that bequests are compensatory.
Highlights
This paper is about the determinants of parents’ decisions regarding the allocation of bequests between their children
This study contributes to the empirical literature testing bequest motives by using a population-wide administrative dataset, covering data on inherited amounts for complete families matched with an extensive set of economic and demographic variables, to estimate the influence of child characteristics on differences in inherited amounts among siblings
For instance, that a higher dispersion in economic resources among the children increases the likelihood of unequal sharing, as predicted by the altruism model
Summary
This paper is about the determinants of parents’ decisions regarding the allocation of bequests between their children. The finding that a mix of biological and adopted children increases the likelihood of unequal sharing is only consistent with the evolutionary model if the biological children (who can carry on the family genes) receive disproportionally more. We take Wilhelm’s work further and test for whether bequests are compensatory with respect to wealth and education but the relationships with the inherited amount are in these cases statistically insignificant Another improvement in relation to Wilhelm is that we show that these findings remain when controlling for an extensive set of other children characteristics and behaviors that parents may use as a basis for discrimination.
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