If there were no bequests in our economy, which occurs when the bequest motive is (left. rho =0,right. ) the intergenerational correlation IC of asset holdings would be negative.
Therefore, making use of the strong law of large numbers and the stability assumption, we can measure the degree of mobility in the long-run by using the steady-state value of the intergenerational correlation IC of asset holdings between two successive generations as in Bossmann et al.
Considering that aging is a time when some of life's most significant financial and health decisions are made (e.g., asset decumulation, asset allocation, annuitization, intergenerational transfers, Medicare/health insurance choices, end of life decisions), an understanding of the factors associated with discounting may have major financial and public health implications.
Within this transnational cross-cultural setting, whether both sides share a common language, i.e. typically, whether the foreign partners speak Chinese fluently enough to communicate, often is a key asset in order to establish good intergenerational relationships, especially at the beginning stage.
Conversely, if we had perfect correlation of asset holdings, i.e., (IC=1,) then intergenerational wealth mobility would be null.
As John Ralfe points out in FTFM, this creates some complex intergenerational issues, such as whether workers have the right to withdraw their assets.
While some of the initiatives – notably the government's pledge to provide insurance for mortgages to new-build properties – are the equivalent of an intergenerational mugging: the state underwrites young people taking on a huge debt for an asset that is clearly overvalued.
They favour it both for the revenues it could produce and because asking for a larger contribution to the exchequer from asset-rich baby boomers might be represented as an act of intergenerational fairness.
Assets and debts also matter a great deal for family well-being and intergenerational mobility.
Intergenerational friendships were forged.
