Publication in the Journal of the European Economic Association
Just before the holidays, Sandra E. Black, Paul J. Devereux, Fanny Landaud, and Kjell G. Salvanes published their study, "The (Un)Importance of Inheritance," exploring the role of gifts and inheritances in economic inequality.
Touching on topics such as household wealth and labor economics, the study "The (Un)Importance of Inheritance" provides new insights into how intergenerational transfers shape income distribution and their limited impact on overall inequality. Using Norwegian administrative data, the authors examine the role of gifts and inheritances in economic inequality. While there is significant inequality in the receipt of these transfers, they account for only a small share of total lifetime income—defined as the sum of labor income, government transfers, and inheritances. Gifts and inheritances primarily benefit individuals with very wealthy parents and have minimal impact on the overall income distribution, suggesting that inheritance taxes may have limited effectiveness in reducing inequality.