Intergenerational altruism and house prices: evidence from bequest tax reforms in Italy

The degree of intergenerational altruism is estimated in a benchmark Barro-type OLG framework with imperfect altruism, exploiting the quasi-experimental variation generated by reforms of the tax treatment of bequests and inter vivos real estate donations enacted in Italy between 2000 and 2001. Using a panel data set containing information on the housing stock and house prices in 13 large Italian cities between 1993 and 2004, the structural parameter of interest is estimated via the effect of the reform on house prices. We identify a lower bound of 0.27, an estimate that agrees with existing ones for the US economy.