Inheritances, social classes, and wealth distribution

PLoS One. 2021 Oct 27;16(10):e0259002. doi: 10.1371/journal.pone.0259002. eCollection 2021.

Abstract

We consider a simple theoretical model to investigate the impact of inheritances on the wealth distribution. Wealth is described as a finite resource, which remains constant over different generations and is divided equally among offspring. All other sources of wealth are neglected. We consider different societies characterized by a different offspring probability distribution. We find that, if the population remains constant, the society reaches a stationary wealth distribution. We show that inequality emerges every time the number of children per family is not always the same. For realistic offspring distributions from developed countries, the model predicts a Gini coefficient of G ≈ 0.3. If we divide the society into wealth classes and set the probability of getting married to depend on the distance between classes, the stationary wealth distribution crosses over from an exponential to a power-law regime as the number of wealth classes and the level of class distinction increase.

Publication types

  • Research Support, Non-U.S. Gov't

MeSH terms

  • Family Characteristics*
  • Humans
  • Models, Theoretical*
  • Social Class*
  • Socioeconomic Factors*

Grants and funding

We acknowledge financial support from the Portuguese Foundation for Science and Technology (FCT) under Contracts no. UIDB/00618/2020 and UIDP/00618/2020. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.