Bequest and Wealth Accumulation

Are Some Pieces of the Puzzle Missing

Dados Bibliográficos

ID4029396
AutoresDenis Kessler (Professor of Economics at the University of Nancy; Centre d'Etudes et de Recherches sur l'Epargne, le Patrimoine et les Inégalités (C.E.R.E.P.I.), Paris, France.), Andre Masson (Senior Research Fellow at the Centre National de la Recherche Scientifique (C.N.R.S.); Centre d'Etudes et de Recherches sur l'Epargne, le Patrimoine et les Inégalités (C.E.R.E.P.I.), Paris, France.)
Ano1989
Volume3
Fascículo3
Páginas141-152
Data de publicação1989-08-01
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoThe Journal of Economic Perspectives (JOURNAL)
Identificadores do periódicoISSN: 0895-3309 • E-ISSN: 1944-7965
EditoraAmerican Economic Association (PUBLISHER • US)
DOI10.1257/jep.3.3.141
OpenAlexW2167866770
IdiomaEN
Citações recebidas25
Referências citadas12

The lively debate between Laurence J. Kotlikoff and Franco Modigliani presented in the Spring 1988 issue of this journal concerns an old question: what is the main motivation for saving and therefore for the accumulation of wealth? More specifically, what are the respective contributions to aggregate wealth of 1) saving for retirement (also known as "hump" saving); 2) precautionary savings (and "unintended" bequests) due to uncertainty about the length of life; and 3) planned bequests? If Modigliani's life-cycle hypothesis is to be viewed as a close to approximation of reality, then the bulk of existing wealth should have resulted from some combination of hump and precautionary saving. Our comment on this dispute attempts to advance two issues. First, the controversy involves an enormous gap between empirical estimates of the share of "inherited wealth" in total accumulation, even though the estimates are often based on the same data. We hope to clarify why the estimates vary so widely. Second, the Kotlikoff/Modigliani dispute is presented as an American issue, with little extension abroad. We will present some results from other countries that bear on the controversy

Bequest · Economics · Keynesian economics · Life-cycle hypothesis · Neoclassical economics · Political science · Positive economics · Financial Literacy, Pension, Retirement Analysis · Fiscal Policy and Economic Growth · Global Health Care Issues · Law