European Journal of Economics and Economic Policies: Intervention

Drivers of wealth inequality in euro area countries: the effect of inheritance and gifts on household gross and net wealth distribution analysed by applying the Shapley value approach to decomposition*

Sebastian Leitner * *

Keywords: inequality, wealth distribution, decomposition analysis, inheritance, inter vivos transfers, income distribution, Europe


This paper investigates the sources of inequality in household gross and net wealth across eight euro area countries applying the Shapley value approach to decomposition. The research draws on micro data from the Eurosystem Household Finance and Consumption Survey 2010. Dispersion in bequests and inter vivos transfers obtained by households are found to have a remarkable effect on wealth inequality that is stronger than that of income differences. In Austria, Germany and Cyprus the contribution of real and financial assets inherited or received as gifts to gross and net wealth inequality attains about 40 per cent. Nevertheless, the distribution of household characteristics (age, education, size, number of adults and children in the household, marital status) within countries also shapes the observed wealth dispersion.

Author Notes

Research was co-financed by the Austrian Chamber of Labour.

Correspondence: The Vienna Institute for International Economic Studies (wiiw), Rahlgasse 3, 1060 Vienna, Austria; email: The author wishes to thank Stefan Jestl, Mario Holzner and Robert Stehrer (wiiw), Miriam Rehm and Matthias Schnetzer (AK-Wien), Philipp Korom (MPIfG – Cologne) and many others for helpful comments and assistance.

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