How inheritances shape wealth distributions: An international comparison

- Decomposition of net household wealth inequality in the inequality loadings of its components.
- First study of this kind with HFCS data yielding comparable results for several Euro countries.
- Shows that intergenerational transfers widely equalize relative wealth inequality.

We use data from the European Household Finance and Consumption Survey in order to examine the distributional effect of intergenerational wealth transfers on the net worth distribution in 8 European countries and compare it to recent findings for the US. To do so, we resort to the decomposition of the coefficient of variation as suggested and applied by Wolff (1987, 2002, 2015) and Wolff and Gittleman (2014). The results seem to imply that inheritances and gifts have a vastly equalizing effect on inequality in household wealth in all 8 countries.