Accidental bequests: a curse for the rich and a boon for the poor
(2012) The Scandinavian journal of economics — Vol. 114, n° 4, p. 1437-1459 (2012)
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Details
- Authors
- Abstract
- When accidental bequests signal otherwise unobservable individual characteristics, such as productivity and longevity, the population should be partitioned into two groups: those who do not receive an inheritance and those who do. The first tagged group receives a Mirrlees second-best tax schedule; the second group, when its type is fully revealed, faces a first-best tax schedule. Receiving an inheritance makes high-ability types worse off and low-ability types better off. High-ability individuals face a bequest tax of more than 100 percent, while low-ability types face a bequest tax that can be smaller, as well as larger, than 100 percent, and it might even be negative.
- Affiliations
Toulouse School of Economics University of Illinois at Urbana-Champaign Université de Liège
Citations
Cremer, H., Gahvari, F., & Pestieau, P. (2012). Accidental bequests: a curse for the rich and a boon for the poor. The Scandinavian journal of economics, 114(4), 1437-1459. https://doi.org/10.1111/j.1467-9442.2012.01728.x (Original work published 2012)