Pestieau, Pierre --- "Gifts, Wills and Inheritance Law" [2011] ELECD 123; in De Geest, Gerrit (ed), "Contract Law and Economics" (Edward Elgar Publishing, 2011)

Book Title: Contract Law and Economics

Editor(s): De Geest, Gerrit

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847206008

Section: Chapter 6

Section Title: Gifts, Wills and Inheritance Law

Author(s): Pestieau, Pierre

Number of pages: 19

Extract:

6 Gifts, wills and inheritance law
Pierre Pestieau


1. Introduction
In this chapter, we want to focus on rather recent literature that studies the
interaction between preferences, institutions and bequests. More explic-
itly, we want to convey the now well-established idea that the level, the
timing and the pattern of bequests is the outcome of the underlying prefer-
ences of the bequeathing parents on the one hand and the prevailing legal
and fiscal institutions constraining bequests on the other.
To do so, we start with the setting in which bequeathing is effected, that
is, the complex network of family relations. The family is indeed the locus
of various transfers and exchanges, either in competition with, or as a com-
plement to, the state or the market. Admittedly, the distinction between
exchange and transfer within the family is not all that clear-cut. Even
though `pure' transfers do not imply explicit counterparts, the simple fact
that they bring utility to the donor makes them less free than it might seem.
Our concern here is with the legal regulation and fiscal treatment of
exchanges or transfers between parents and children, which may be mon-
etary or in kind. In addition to wealth transfers such as bequests and gifts,
there is also the education that parents provide to their offspring through
an investment in both time and money, not to mention the transmission of
intangible social capital. There are also different types of assistance, often
in the form of services: these may ...