This project, supported by the Nuffield Foundation, investigated the direct transmission of wealth across generations in rich countries and the role of institutions, policy and legislation in the intergenerational transmission of wealth. While a good deal is known about inter-generational mobility in income, social class and education, there remain serious gaps in knowledge about the role of wealth in the transmission of socio-economic advantages and disadvantages from one generation. The project provided a new quantitative picture of who benefits from direct transmission of wealth across generations in Great Britain and how this compares with other rich countries. It evaluated the data currently available to study wealth transfers in Britain and how these can be improved and produced a dedicated dataset from the Wealth and Assets Survey suited for this purpose.
A key finding from analysis of this and corresponding data for a number of other rich countries is that while the division of estates on death is generally wealth-equalising, large inheritances are dis-equalising. This finding, and the methods developed for identifying the level above which such transfers serve to increase wealth concentration, has important implications for how the UK’s system of taxation on capital transfers, and such taxes more generally, might best be reformed. The research was carried out by Professor Brian Nolan, Professor Erzsébet Bukodi, and Dr. Juan C. Palomino, together with Professor Salvatore Morelli (CUNY) and Professor Philippe Van Kerm (University of Luxembourg).