Labour Supply after Inheritances and the Role of Expectations

21 Pages Posted: 7 Oct 2020

Date Written: August 2020

Abstract

This paper examines the effect of inheritances on labour supply, distinguishing between unanticipated and anticipated inheritances. We use household and individual level micro‐data for Germany to investigate the effect of inheritances on a number of labour market outcomes. Women are less likely to work full‐time after an inheritance and their desired and actual hours of work decrease by 1–2 per week, on average. The magnitude of the effect is found to be larger and more precisely estimated for households without children and liquidity constrained households. Other margins such as time use outside the labour market and satisfaction are also found to be affected by inheritance receipt.

Suggested Citation

Doorley, Karina and Pestel, Nico, Labour Supply after Inheritances and the Role of Expectations (August 2020). Oxford Bulletin of Economics and Statistics, Vol. 82, Issue 4, pp. 843-863, 2020, Available at SSRN: https://ssrn.com/abstract=3706183 or http://dx.doi.org/10.1111/obes.12353

Karina Doorley (Contact Author)

ESRI ( email )

Whitaker square Sir john Rogerson's Quay
Dublin 2
Dublin
Ireland

Nico Pestel

IZA ( email )

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