Giving with a warm hand: Evidence on estate planning and bequests

  • Eduard Suari Andreu Eduard Suari Andreu
  • Raun van Ooijen Raun van Ooijen
  • Rob Alessie Rob Alessie
  • Viola Angelini Viola Angelini

In this paper we study the bequest motive for saving, using administrative data on all deaths that occurred in the Netherlands between 2006 and 2013. In doing so, we build on the previous work by Kopczuk (2007). We study whether individuals start transferring part of their estate to their heirs in the expectation of death in the foreseeable future. First, we distinguish between sudden and non-sudden death. Second, controlling for gender, age, marital status, and permanent income, we find that non-sudden deaths are associated with less wealth at the time of death. We find the strongest effect, a difference in financial wealth of about 24%, for single individuals who die of cancer. Relying on the richness of our data and on the characteristics of the Dutch institutional context, we interpret this result as a reflection estate planning that is triggered by an underlying bequest motive.

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.

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