Luigi, Cannnari and Giovanni, D'Alessio (2008): Intergenerational Transfers in Italy. Published in: Household Wealth in Italy (Banca d’Italia) (May 2008): pp. 255-286.
Download (395kB) | Preview
In this paper we examine the role of intergenerational transfers in the wealth accumulation of Italian households. Received transfers represent an important share of the net wealth held by households. Direct estimates referring to 2002 range from 30 to 55 per cent, depending on the inclusion of the income stream produced by transferred assets. This share has shown a tendency to increase over the last decade. In a lifetime perspective, the ratio of transfers received over the whole life span to the total amount of resources, both computed at the age of 15, is on average equal to 4.6 per cent, a significant share considering the size of the denominator. Transfers are very concentrated, more than income and wealth, even when considered in a lifetime perspective. Households receiving transfers show higher levels of lifetime income, consumption, net wealth and given transfers than non-recipient households. Richer households receive larger transfers but, as a proportion of their current wealth holdings, transfers are greater for poorer households than richer ones. These results cannot be interpreted as an equalising effect of transfers, because people tend to react to transfers, changing their saving and consumption behaviour. The correlation between transfers (received or expected over the whole life span) and lifetime income is positive. Again, richer households receive greater inheritances and other wealth transfers than poorer households; as a proportion of their lifetime income, transfers are greater for poorer households than richer ones. This result is likely to be due to the much more important role played by family background variables than bequests as factors of transmission of inequality of lifetime resources. Finally, we find a positive relationship between left-to-children bequests and received-from-parents inheritances; this relationship holds even after controlling for lifetime resources, suggesting the importance of the role of family traditions.
|Item Type:||MPRA Paper|
|Original Title:||Intergenerational Transfers in Italy|
|Keywords:||Households, Wealth, Intergenerational transfers|
|Subjects:||D - Microeconomics > D3 - Distribution > D31 - Personal Income, Wealth, and Their Distributions
E - Macroeconomics and Monetary Economics > E2 - Macroeconomics: Consumption, Saving, Production, Employment, and Investment > E21 - Consumption; Saving; Wealth
|Depositing User:||Giovanni D'Alessio|
|Date Deposited:||09. May 2009 13:04|
|Last Modified:||14. Feb 2013 12:38|
Ando, A., Guiso, L. and I. Visco (eds.) (1994), Savings and the Accumulation of Wealth, Cambridge, Cambridge University Press.
Atkinson, A.B. and A. Brandolini (2005), “World Income Inequality: Absolute, Relative or Intermediate?”, mimeo.
Attanasio, O. and H.W. Hoynes (2000), “Differential Mortality and Wealth Accumulation”, Journal of Human Resources, Vol. 35, No. 1, pp. 1-29.
Banca d’Italia (1993), “I bilanci delle famiglie italiane nell’anno 1991”, Supplementi al Bollettino Statistico, new series, year III, No. 44, July.
Banca d’Italia (2002), “Italian Household Budgets in 2000”, Supplements to the Statistical Bulletin, edited by G. D’Alessio and I. Faiella, new series, year XII, No. 6, January.
Banca d’Italia (2004), “Italian Household Budgets in 2002”, Supplements to the Statistical Bulletin, edited by C. Biancotti, G. D’Alessio, I. Faiella and A. Neri, new series, year XIV, No. 12, March.
Banca d’Italia (2006), “Italian Household Budgets in 2004”, Supplements to the Statistical Bulletin, edited by I. Faiella, R. Gambacorta, S. Iezzi and A. Neri, new series, year XVI, No. 7, January.
Barca, F., Cannari, L. and L. Guiso, (1994), “Bequests and Savings for Retirement. What Impels the Accumulation of Wealth?”, in Ando, Guiso and Visco (1994), pp. 349-365.
Becker, G. (1981), A Treatise on the Family, Cambridge, MA, Harvard University Press.
Bernheim, D., Shleifer, A. and L. Summers (1985), “The Strategic Bequest Motive”, Journal of Political Economy, Vol. 93, No. 6, pp. 1045-1076.
Biancotti, C., D’Alessio, G. and A. Neri (2004), “Errori di misura nell’indagine sui bilanci delle famiglie italiane”, Banca d’Italia, Temi di discussione, No. 522.
Bowles, S. and H. Gintis (2002), “The Inheritance of Inequality”, Journal of Economic Perspectives, Vol. 16, No. 3, pp. 3-30.
Brandolini, A. (1999), “The Distribution of Personal Income in Post-War Italy: Source Description, Data Quality, and the Time Pattern of Income Inequality”, Giornale degli Economisti e Annali di Economia, Vol. 58, No. 2, pp. 183-239.
Brandolini, A. and L. Cannari (1994), “Methodological Appendix: The Bank of Italy’s Survey of Household Income and Wealth”, in Ando, Guiso Visco (1994), pp. 369-386.
Brandolini, A., Cannari, L., D’Alessio, G. and I. Faiella (2004), “Household Wealth Distribution in Italy”, Banca d’Italia, Temi di discussione, No. 530.
Brown, J.R., Coile, C.C. and S.J. Weisbenner (2006), “The Effect of Inheritance Receipt on Retirement”, mimeo.
Brown, J.R, and S.J. Weisbenner (2002), “Is a Bird in Hand Worth More than a Bird in the Bush? Intergenerational Transfers and Savings Behavior”, NBER, Working Paper No. 8753, February.
Cameron, L. and D.A. Cobb-Clark (2001), “Old-Age Support in Developing Countries: Labor Supply, Intergenerational Transfers and Living Arrangements”, IZA Discussion Paper No. 289.
Cannari, L. and G. D’Alessio (2006), La ricchezza degli italiani, Bologna, Il Mulino.
Cannari, L., D’Alessio, G. and R. Gambacorta (2006), “Capital Gains and Wealth Distribution in Italy”, paper presented at the Third IFC Conference on “Measuring the Financial Position of the Household Sector”, August 28-30, Basel.
Christelis, D. and G. Weber (2007), “Expected Bequests and Current Wealth in SHARE, ELSA and HRS”, paper presented at the Workshop “SHARE: a Survey of Health, Ageing and Retirement in Europe”, Banca d’Italia, 19 January, Roma.
Cox, D. (1987), “Motives for Private Income Transfers”, Journal of Political Economy, Vol. 95, No. 3, pp. 508-546.
Cox, D. and O. Stark (2005), “Bequests, Inheritances and Family Traditions”, Center for Retirement Research, Working Paper No. 2005-09.
De Nardi, M. (2004), “Wealth Inequality and Intergenerational Links”, Review of Economic Studies, Vol. 71, pp. 743-768.
Gokhale, J., Kotlikoff, L.J., Sefton, J. and M. Weale (2001), “Simulating the Trasmission of Wealth Inequality via Bequests”, Journal of Public Economics, Vol. 79, pp. 93-128.
Gokhale, J. and L.J. Kotlikoff (2002), “Simulating the Transmission of Wealth Inequality”, American Economic Review, Papers and Proceedings, Vol. 92, No. 2, pp. 265-269.
Holtz-Eakin, D., Joulfaian, D. and H.S. Rosen (1993), “The Carnegie Conjecture: Some Empirical Evidence”, The Quarterly Journal of Economics, Vol. 108, No. 2, pp. 413-435.
Hurd, M. and J.P. Smith (2002), “Expected Bequests and Their Distribution”, NBER, Working Paper No. 9142.
Joulfaian, D. and M.O. Wilhelm (1994), “Inheritances and Labor Supply”, Journal of Human Resources, Vol. 29, No. 4, pp. 1205-1234.
Kessler, D. and A. Masson (1989) “Bequest and Wealth Accumulation: Are Some Pieces of the Puzzle Missing?”, Journal of Economic Perspectives, Vol. 3, No. 3, pp. 141-152.
Kotlikoff, L.J. and L.H. Summers (1981), “The Role of Intergenerational Transfers in Aggregate Capital Accumulation”, Journal of Political Economy, Vol. 89, pp. 706-732.
Kopczuk, W. and J.P. Lupton (2005), “To Leave or Not to Leave: the Distribution of Bequest Motives”, NBER, Working Paper No. 11767.
Modigliani, F. (1988), “The Role of Intergenerational Transfers and the Life Cycle Saving in the Accumulation of Wealth”, Journal of Economic Perspectives, Vol. 2, No. 1, pp. 15-40.
Yaari, M.E. (1965), “Uncertain Lifetime, Life Insurance, and the Theory of the Consumer”, Review of Economic Studies, Vol. 32, No. 2, pp. 137-150.
Wolff, E.N. (2002), “Inheritances and Wealth Inequality, 1989-1998”, American Economic Review, Papers and Proceedings, Vol. 92, No. 2, pp. 260-264.