{{Short description, Justification for leaving money to others A bequest motive seeks to provide an economic justification for the phenomenon of intergenerational transfers of

wealth Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions. This includes the core meaning as held in the originating Old English word , which is from an I ...

. In other words, to explain why people leave money behind when they die. Which bequest motive theory most realistically represents the intentions of estate planners is unclear. Attempts to test the theories empirically are mired by poor availability of data about wealth holdings. *The most common explanation for this is

altruism Altruism is the principle and moral practice of concern for the welfare and/or happiness of other human beings or animals, resulting in a quality of life both material and spiritual. It is a traditional virtue in many cultures and a cor ...

, in which it is held that the disponer gains some form of satisfaction from knowing that his/her heirs will enjoy their inherited wealth. An example might be a parent leaving a child the family home. *Another common explanation is accidental bequest, developed by economists Yaari (1965) and Davies (1980). Here it is not assumed that the disponer (

testator A testator () is a person who has written and executed a last will and testament that is in effect at the time of their death. It is any "person who makes a will."Gordon Brown, ''Administration of Wills, Trusts, and Estates'', 3d ed. (2003), p. 556 ...

) gains any specific benefit from leaving a bequest, but rather that lifetime is uncertain, and so she/he holds precautionary savings to insure him/herself against the risk of living too long. Unspent wealth at time of death is transferred according to

intestacy Intestacy is the condition of the estate of a person who dies without having in force a valid will or other binding declaration. Alternatively this may also apply where a will or declaration has been made, but only applies to part of the esta ...

law. *Finally, exchange bequest occurs where disponers engage in a sort of strategic

game A game is a structured form of play, usually undertaken for entertainment or fun, and sometimes used as an educational tool. Many games are also considered to be work (such as professional players of spectator sports or games) or art (suc ...

in which potential beneficiaries must render a (non-marketable) service in exchange for the promise of inherited wealth. The most widely read model of exchange bequest was published by Bernheim, Summers and Shleifer (1985).

References

Bernheim, B.D.; Shleifer, A.; Summers L.H. (1985) “The Strategic Bequest Motive” in ''Journal of Political Economy'', Vol 93, No. 6, 1045-1076 Masson, A. and Pestieau P. (1997) “Bequest Motives and Models of Inheritance: A Survey of the Literature” in (Erreygers and Vandevelde eds.) ''Is Inheritance Legitimate? Ethical and Economic Aspects of Wealth Transfers'' Springer, Berlin Family economics Inheritance

See also

References