Born with a Silver Spoon? Danish Evidence on Wealth Inequality in Childhood

31 Pages Posted: 6 Jul 2018

See all articles by Simon Halphen Boserup

Simon Halphen Boserup

University of Copenhagen

Wojciech Kopczuk

Columbia University - Graduate School of Arts and Sciences - Department of Economics; Columbia University - School of International & Public Affairs (SIPA); National Bureau of Economic Research (NBER)

Claus Thustrup Kreiner

University of Copenhagen - Department of Economics

Multiple version iconThere are 3 versions of this paper

Date Written: July 2018

Abstract

We use Danish wealth records from three decades to characterise wealth inequality in childhood, where the main source of wealth is transfers. Wealth holdings are small in childhood but they have strong predictive power for future wealth in adulthood. At age 18, asset holdings of children are more informative than parental wealth in predicting wealth of children when they are in their 40s. We investigate why and rule out that childhood wealth in itself can accumulate enough to explain later wealth inequality. Instead, childhood wealth seems to proxy for intergenerational correlation in savings behaviour and additional transfers from parents.

Suggested Citation

Boserup, Simon Halphen and Kopczuk, Wojciech and Kreiner, Claus Thustrup, Born with a Silver Spoon? Danish Evidence on Wealth Inequality in Childhood (July 2018). The Economic Journal, Vol. 128, Issue 612, pp. F514-F544, 2018. Available at SSRN: https://ssrn.com/abstract=3209001 or http://dx.doi.org/10.1111/ecoj.12496

Simon Halphen Boserup (Contact Author)

University of Copenhagen ( email )

Nørregade 10
Copenhagen, København DK-1165
Denmark

Wojciech Kopczuk

Columbia University - Graduate School of Arts and Sciences - Department of Economics ( email )

420 W. 118th Street
New York, NY 10027
United States

Columbia University - School of International & Public Affairs (SIPA)

420 West 118th Street
New York, NY 10027
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Claus Thustrup Kreiner

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark

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