NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

How Strong are Bequest Motives? Evidence Based on Estimates of the Demand for Life Insurance and Annuities

B. Douglas Bernheim

NBER Working Paper No. 2942 (Also Reprint No. r1699)
Issued in March 1992
NBER Program(s):   PE

This paper presents new empirical evidence in support of the view that a significant fraction of total saving is motivated solely by the desire to leave bequests. Specifically, I find that Social Security annuity benefits significantly raise life insurance holdings and depress private annuity holdings among elderly individuals. These patterns indicate that the typical household would choose to maintain a positive fraction of its resources in bequeathable forms, even if insurance markets were perfect. Evidence on the relationship between insurance purchases and total resources reinforces this conclusion.

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Document Object Identifier (DOI): 10.3386/w2942

Published: Journal of Political Economy, Vol. 99, No. 5, pp. 899-927, (October) 1991. citation courtesy of

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