Munich Personal RePEc Archive

Bequeathing in ambiguous times

Saito, Yuta (2020): Bequeathing in ambiguous times.

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Abstract

This paper studies a model of altruistic bequest in times of ambiguity. The parent is ambiguous about future economic conditions, which affects the probability of the child’s economic success. We show that an increase in the degree of ambiguity makes the parent leave more transfer. Our model implies that the amount of parental transfer grows during a pandemic or recession.

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