Aspirations, Habit Formation, and Bequest Motive

Bibliographic Data

ID9716907
AuthorsJaime Alonso‐Carrera (0000-0001-8525-7769, Universidade de Vigo), Jordi Caballé (0000-0003-0253-5634, Universitat Autnoma de Barcelona), Xavier Raurich (0000-0002-5210-1909, Universitat de Barcelona)
Year2007
Volume117
Issue520
Pages813-836
Publication date2007-04-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueThe Economic Journal (JOURNAL)
Journal identifiersISSN: 0013-0133 • E-ISSN: 1468-0297
PublisherOxford University Press (OUP) (PUBLISHER)
DOI10.1111/j.1468-0297.2007.02051.x
OpenAlexW2095660191
LanguageEN
Citations received5
References cited32

We consider an economy where individuals use their standard of living based on past consumption in order to evaluate the utility arising from current consumption. We analyse how this process of preference formation affects the bequest motive. We show that habits (based on one's own past consumption) reduce the willingness of individuals to leave bequests, while aspirations (based on the standard of living of parents) make the existence of positive bequests easier. The long-run effects of both habits and aspirations on capital stock and on the amount of bequests depend on whether or not the bequest motive is operative. Copyright 2007 The Author(s). Journal compilation Royal Economic Society 2007

Bequest · Capital (architecture · Consumption (sociology · Demographic economics · Economics · Habit · Labour economics · Microeconomics · Order (exchange · Political science · Preference · Sociology · Stock (firearms · Time preference · Economic theories and models · Financial Literacy, Pension, Retirement Analysis · Housing Market and Economics · Psychology · Social Psychology

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