Inheritance and Inequality

(With Hanno Hilbig)

Why are some societies more unequal than others? The French revolutionaries believed unequal inheritances within families to be responsible for the strict social hierarchies of the Ancien Regime. To achieve social equality, the revolutionaries therefore enforced equal inheritance rights. Their goal was to empower women and to disenfranchise the noble class. But, does equitable inheritance succeed in levelling the social playing field? We study Germany—a country with pronounced micro-level variation in inheritance customs—and find that municipalities that historically equally apportioned wealth, to this day, elect more women into political councils and see fewer aristocrats in the social elite. Using historic data, we point to two mechanisms: increased wealth equality and more pronounced pro-egalitarian preferences. Finally, we explore the role of incomes and find that equitable inheritance customs increase incomes and income inequality. We interpret this finding to mean that equitable inheritance levels the playing field by rewarding talent, not status.

Link to paper

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