Lobbying, Family Concerns, and the Lack of Political Support for Estate Taxation

15 Pages Posted: 7 Oct 2015

See all articles by Philippe De Donder

Philippe De Donder

University of Toulouse 1 - Toulouse School of Economics (TSE)

Pierre Pestieau

University of Liège - Research Center on Public and Population Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE)

Date Written: November 2015

Abstract

We provide an explanation for why estate taxation is surprisingly little used, given the skewness of the estate distribution. Taxing estates implies meddling with intra‐family decisions, which is frown upon by many. At the same time, given the concentration of estates a small proportion of the population stands to gain a lot by decreasing estate taxation. We provide an analytical model, together with numerical simulations, where agents bequeathing large estates make monetary contributions to play up the salience of the encroachment aspects of estate taxation on family decisions and to decrease its political support.

Suggested Citation

De Donder, Philippe and Pestieau, Pierre, Lobbying, Family Concerns, and the Lack of Political Support for Estate Taxation (November 2015). Economics & Politics, Vol. 27, Issue 3, pp. 389-403, 2015, Available at SSRN: https://ssrn.com/abstract=2670308 or http://dx.doi.org/10.1111/ecpo.12062

Philippe De Donder (Contact Author)

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Pierre Pestieau

University of Liège - Research Center on Public and Population Economics ( email )

Boulevard du Rectorat, 7, Batiment 31
Sart-Tilman
B-4000 Liege, 4000
Belgium
+32 4 366 3108 (Phone)
+32 4 366 3106 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE) ( email )

34 Vopie Roman Pays
Louvain la Neuve
Belgium

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