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The influence of inheritances on wealth inequality in rich countries
July 2025
Abstract: This paper uses survey data from Germany, Spain, France, Italy, Great Britain and the United States to analyze how inheritances impact wealth inequality in a range of rich countries. Adopting an influence function regression approach, the paper calculates the counterfactual effects of small increases in the share of recipients of different-sized wealth transfers in each country. Results suggest that while a marginal increase in inheritance recipients generally contracts wealth inequality measures—confirming a common finding in the literature that inter-generational transfers tend to reduce relative wealth inequality—an increase in recipients of ‘large’ inheritances has the opposite effect. We determine what ‘large’ means in this context by point-estimating the thresholds above which transfers become disequalising. We find that transfers above the ninety-fifth percentile of the national transfer distribution are generally associated with an increasing effect on wealth inequality. Such thresholds are then put in perspective against the inheritance tax schedules in place in the six countries analyzed. No unique pattern emerges. While the thresholds are very close to tax exemption thresholds in Britain and Germany, they are somewhat higher in France and Spain and they are much lower in Italy and the United States.
| Type: | Journal article |
| Theme(s): | Wealth accumulation and wealth inequality Econometrics and survey statistics |
| Keywords: | Influence function, Inheritance taxation, Inheritances, Intergenerational transfers, Wealth inequality |
| JEL Classification: | D31, G50, H20 |
| 10.1016/j.jpubeco.2025.105398 | |
| RePEc:eee:pubeco:v:247:y:2025:i:c:s0047272725000969 |
Reference
Morelli, S., Nolan, B., Palomino, J.C. & Van Kerm, P. (2025), 'The influence of inheritances on wealth inequality in rich countries', Journal of Public Economics, 247(C), 105398.
@ARTICLE{pvk-1011,
Author = {Morelli, Salvatore and Nolan, Brian and Palomino, Juan C. and Van Kerm, Philippe},
Title = {The influence of inheritances on wealth inequality in rich countries},
Journal = {Journal of Public Economics},
Volume = {247},
Number = {C},
Pages = {105398},
Month = jul,
Year = {2025}
}Download links
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Supplementary material
Other versions
Morelli, S., Nolan, B., Palomino, J.C. & Van Kerm, P. (2024), 'The influence of inheritances on wealth inequality in rich countries', Stone Center Working Paper Series j76ds, Stone Center on Socio-Economic Inequality, City University of New York, New York, USA.
Presentation(s) of this work (PVK only)
The influence of intergenerational transfers on wealth inequality – Some new results from the Luxembourg Wealth Study. Workshop on Socio-Economic Inequality in China and the World, Hong Kong, 2026.
The influence of intergenerational transfers on wealth inequality in rich countries revisited. LISER-NUIG-IMA Microsimulation and Inequality Global Seminar Series, e-Esch/Alzette, 2022.
Transfer wealth and wealth inequality: What do wealth and asset surveys tell us?. Deutsche Bundesbank Research Seminar, e-Frankfurt, 2021.
Dataset(s) used in the paper
Other papers using the same datasets...
Lekfuangfu, W.N., Olivera, J. & Van Kerm, P. (2026), 'Bequest division: The roles of parental motives and children’s gender composition', Labour Economics, 10295.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2022), 'The wealth (disadvantage) of single-parent households', Annals of the American Academy of Political and Social Science, 702(1), 188-204.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2021), 'Intergenerational wealth transfers and wealth inequality in rich countries: What do we learn from Gini decomposition?', Economics Letters, 199, 10970.
Morelli, S., Nolan, B., Palomino, J.C. & Van Kerm, P. (2021), 'Inheritance, gifts and the accumulation of wealth for low-income households', Journal of European Social Policy, 31(5), 533-548.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2020), 'The Wealth of Families: The Intergenerational Transmission of Wealth in Britain in Comparative Perspective', Report to the Nuffield Foundation, Institute for New Economic Thinking, Oxford Martin School, University of Oxford.
Chauvel, L., Hartung, A., Bar-Haim, E. & Van Kerm, P. (2019), 'Income and Wealth Above the Median: New Measurements and Results for Europe and the United States', in K. Decancq & P. Van Kerm, What Drives Inequality?, Research on Economic Inequality27, Emerald Publishing Ltd, Bingley, pp.89-104.
Nolan, B., Morelli, S. & Van Kerm, P. (2018), 'Wealth Inequality', in B. Nolan, Generating Prosperity for Working Families in Affluent Countries, Oxford University Press, Oxford, UK, Ch.12, pp.312-334.
Carpantier, J.-F., Olivera, J. & Van Kerm, P. (2018), 'Macroprudential policy and household wealth inequality', Journal of International Money and Finance, 85(C), 262-277.
Cowell, F.A., Nolan, B., Olivera, J. & Van Kerm, P. (2017), 'Wealth, Top Incomes, and Inequality', in K. Hamilton & C. Hepburn, National Wealth: What is Missing, Why it Matters, Oxford University Press, Oxford, UK, Ch.8, pp.175-203.
Cowell, F.A. & Van Kerm, P. (2015), 'Wealth Inequality: A Survey', Journal of Economic Surveys, 29(4), 671-710.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2022), 'Intergenerational wealth transfers in Great Britain from the Wealth and Assets Survey in comparative perspective', Fiscal Studies, 43(2), 179-199.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2022), 'The wealth (disadvantage) of single-parent households', Annals of the American Academy of Political and Social Science, 702(1), 188-204.
Morelli, S., Nolan, B., Palomino, J.C. & Van Kerm, P. (2021), 'Inheritance, gifts and the accumulation of wealth for low-income households', Journal of European Social Policy, 31(5), 533-548.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2020), 'The Wealth of Families: The Intergenerational Transmission of Wealth in Britain in Comparative Perspective', Report to the Nuffield Foundation, Institute for New Economic Thinking, Oxford Martin School, University of Oxford.
Nolan, B., Morelli, S. & Van Kerm, P. (2018), 'Wealth Inequality', in B. Nolan, Generating Prosperity for Working Families in Affluent Countries, Oxford University Press, Oxford, UK, Ch.12, pp.312-334.
Other papers on the same theme(s)
Olivera, J., Schokkaert, E. & Van Kerm, P. (2026), 'The role of information in eliciting support for inheritance taxation: experimental evidence from Luxembourg', International Tax and Public Finance.
Lekfuangfu, W.N., Olivera, J. & Van Kerm, P. (2026), 'Bequest division: The roles of parental motives and children’s gender composition', Labour Economics, 10295.
Chauvel, L., Bar-Haim, E., Hartung, A. & Van Kerm, P. (2024), 'Increasing Inequality in Joint Income and Wealth Distributions in the United States, 1995 to 2013', Luxembourg Wealth Study Working Paper 46, LIS Cross-National Data Center, Esch/Alzette, Luxembourg.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2022), 'Intergenerational wealth transfers in Great Britain from the Wealth and Assets Survey in comparative perspective', Fiscal Studies, 43(2), 179-199.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2022), 'The wealth (disadvantage) of single-parent households', Annals of the American Academy of Political and Social Science, 702(1), 188-204.
Olivera, J. & Van Kerm, P. (2022), 'Public Support for Tax Policies in COVID-19 Times: Evidence from Luxembourg', International Tax and Public Finance, 29(6), 1395-1418.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2021), 'Intergenerational wealth transfers and wealth inequality in rich countries: What do we learn from Gini decomposition?', Economics Letters, 199, 10970.
Morelli, S., Nolan, B., Palomino, J.C. & Van Kerm, P. (2021), 'Inheritance, gifts and the accumulation of wealth for low-income households', Journal of European Social Policy, 31(5), 533-548.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2020), 'The Wealth of Families: The Intergenerational Transmission of Wealth in Britain in Comparative Perspective', Report to the Nuffield Foundation, Institute for New Economic Thinking, Oxford Martin School, University of Oxford.
Nolan, B., Palomino, J.C., Van Kerm, P. & Morelli, S. (2020), 'The intergenerational transmission of wealth in rich countries', VoxEU 19 September 2020, Centre for Economic Policy Research, London, UK.
Chauvel, L., Hartung, A., Bar-Haim, E. & Van Kerm, P. (2019), 'Income and Wealth Above the Median: New Measurements and Results for Europe and the United States', in K. Decancq & P. Van Kerm, What Drives Inequality?, Research on Economic Inequality27, Emerald Publishing Ltd, Bingley, pp.89-104.
Nolan, B., Morelli, S. & Van Kerm, P. (2018), 'Wealth Inequality', in B. Nolan, Generating Prosperity for Working Families in Affluent Countries, Oxford University Press, Oxford, UK, Ch.12, pp.312-334.
Carpantier, J.-F., Olivera, J. & Van Kerm, P. (2018), 'Macroprudential policy and household wealth inequality', Journal of International Money and Finance, 85(C), 262-277.
Cowell, F.A., Nolan, B., Olivera, J. & Van Kerm, P. (2017), 'Wealth, Top Incomes, and Inequality', in K. Hamilton & C. Hepburn, National Wealth: What is Missing, Why it Matters, Oxford University Press, Oxford, UK, Ch.8, pp.175-203.
Cowell, F.A. & Van Kerm, P. (2015), 'Wealth Inequality: A Survey', Journal of Economic Surveys, 29(4), 671-710.
Jäntti, M., Sierminska, E.M. & Van Kerm, P. (2015), 'Modeling the Joint Distribution of Income and Wealth', in T. Garner & K. Short, Measurement of Poverty, Deprivation, and Economic Mobility, Research on Economic Inequality23, Emerald Group Publishing Limited, pp.301-327.
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