Analysis of China's Heritage Inheritance and Property Inequality

Abstract: This paper estimates the inheritance characteristics of inheritance based on micro-individual data in 2010. On this basis, it discusses the impact of inheritance on property inequality and the redistribution effect that different inheritance taxes may play. The main method of the article is to use Monte Carlo simulation to estimate the general inheritance of inheritance based on micro-individual property distribution, family member structure and mortality information. It was found that the inheritance of the inheritors and their initial property accounted for 68%, and the inheritance of the children's heirs accounted for 22% of the initial property. However, due to the low average mortality rate, the total heritage of the transfer accounted for only 0.43% of the total social property. The paper also finds that inheritance of inheritance does not necessarily lead to an increase in property inequality, and the specific effects are related to factors such as the distribution of mortality of the poor and the rich, family characteristics, and distribution of property within the family. Finally, this paper finds that the redistribution effect of the inheritance tax collection process is relatively weak, but if the government can use the inheritance tax income to improve the living conditions of the poor, the redistribution effect will be greatly enhanced.

Writer: Zhan Peng School of Economics, Nanjing University of Finance and Economics

     Wu Shanshan China Institute of Income Distribution, Beijing Normal University

     Li Shi School of Economics and Management, Beijing Normal University

     Wan Haiyuan School of Economics and Management, Beijing Normal University