November 2, 2015

CAAR – National Bureau of Economic Research Working Paper – November 2, 2015

Filed under: Working Papers — Tags: , — admin @ 4:54 pm

Links to an abstract are available. For full text availability check your organization’s library.

A. “What Determines End-of-Life Assets? A Retrospective View,” by James Poterba, Steven Venti, and David A. Wise (w21682, October 2015, .pdf format, 35p.).


We consider assets when individuals were last observed prior to death in the Health and Retirement Study (HRS) and trace assets backwards to the age when these individuals were first observed. For most individuals, assets in the last year observed (LYO) were very similar to assets in the first year observed (FYO). In particular, most of those who were last observed with very low asset levels also had low assets when first observed. We also estimate the relationship between an individual’s asset change between the first and last date of observation, that individual’s education and health status when first observed, and that individual’s within-sample changes in health and family composition. We obtain estimates for HRS respondents who were 51 to 61 in 1992 and for AHEAD respondents who were age 70 and over in 1993.

B. “Unequal Bequests,” by Marco Francesconi, Robert A. Pollak, and Domenico Tabasso (w21692, October 2015, .pdf format, 57p.).


Using data from the Health and Retirement Study (HRS), we make two contributions to the literature on end-of-life transfers. First, we show that unequal bequests are much more common than generally recognized, with one-third of parents with wills planning to divide their estates unequally among their children. These plans for unequal division are particularly concentrated in complex families, which are of two types: families with stepchildren and families with genetic children with whom the parent has had no contact, e.g., children from previous marriages. We find that in complex families past and current contact between parents and children reduces or eliminates unequal bequests. Second, although the literature focuses on the bequest intentions of parents who have made wills, we find that many older Americans have not made wills. Although the probability of having a will increases with age, 30 percent of HRS respondents aged 70 and over have no wills. Of HRS respondents who died between 1995 and 2010, 38 percent died without wills. Thus, focusing exclusively on the bequest intentions of parents who have made wills may provide an incomplete and misleading picture of end-of-life transfers.

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