The key thesis to be explored is that for some kinds of wealth and some economic systems the parents’ wealth strongly predicts the wealth of the offspring. In particular, the cattle, land and other types of material wealth of pastoral and agricultural economies are directly transmitted by simple transfers, often buttressed by social conventions of inheritance. By contrast the somatic wealth and skills and the social network ties central to foraging and horticultural livelihoods are more subject to the vagaries of learning, genetic recombination, and childhood development. Moreover, in foraging and horticultural economies, such material wealth as exists tends to circulate through broad social networks rather than being vertically transmitted to offspring. A corollary of the thesis is that, if our model is correct, economies in which material wealth is important will show substantial levels of wealth inequality. Both the thesis and the corollary find strong support in our data. We focus on small-scale societies because they offer the greatest variation in both the technologies by which a livelihood is gained and the basic institutions that provide the incentives and constraints regulating economic life, including the dynamics of inequality and the inheritance process. . These societies thus provide the most powerful lens for exploring hypotheses concerning the importance of technologies and institutions in explaining the dynamics of inequality and, thus, may also illuminate long-term trends in contemporary and future economies. The connection between wealth inheritance and wealth inequality is the following: If wealth is strongly transmitted across generations, chance shocks to the economic fortunes of a household due to disease or accident,frambueso maceta luck in a hunt or harvest, and other environmental disturbances or windfalls will be reproduced in the next generation.

These effects will thus accumulate over time and thereby counteract the widely observed inequality dampening tendency of regression to the mean . We seek to understand the effects of this process by examining how the offsetting effects of random shocks and imperfect transmission across generations jointly determine a steady state distribution of wealth for differing kinds of wealth and across the four different economic systems . The institutions and norms that characterize distinct economic systems and the nature of the wealth class alike will affect the degree of inter generational transmission.For a number of modern economies, there are quantitative estimates and comparisons of the inter generational transmission of education, occupational prestige, nonhuman physical capital, and other forms of embodied and material wealth . For small-scale populations, associations between reproductive success and material forms of wealth have been studied , and there exist piecemeal estimates of inter generational transmission of, for example, fertility and height . But there are no estimates allowing a comparison across populations of the inheritance of the distinctive kinds of wealth that are central to the livelihoods of small-scale communities of foragers, horticulturalists, herders, and farmers. Here we present a new set of data and conduct a quantitative comparative analysis of the transmission of distinct types of wealth among the 21 populations shown in Fig.1 and Table 1. Further information is provided in .Since the development of human capital theory a half-century ago, it has been conventional to treat wealth as a multidimensional attribute, as evidenced by the adjectives now routinely applied to the word “capital,” namely, social, somatic, material, cultural, and network . We identified three broad classes of wealth in our populations, namely, embodied; material ; and relational . We have no measures of other heritable determinants of well-being such as ritual knowledge, an important source of institutionalized inequality in some populations.

By linking the level of wealth of parents and adult offspring, measured as appropriate for individuals or households , we are able to estimate the degree of inter generational persistence for particular types of wealth and then to create averages for each broad class of wealth. We classify economic systems according to the conventions of anthropology . Hunter gatherer economic systems are those that make minimal use of domesticated species , whereas pastoralists rely heavily, though rarely exclusively, on livestock kept for subsistence and sometimes commercial purposes. Although both horticulturalists and agriculturalists use domesticated plants and animals, horticulturalists do not typically use ploughs, their cultivation is labor- not land-limited, and land markets are absent or limited. As with all classificatory systems, there are some ambiguities of assignment of our populations to these classes, but the least improbable reclassifications do not affect our results [see , section 4]. Transmission of wealth across generations need not take the form of bequests, or the literal passing on of physical objects . What matters for the long-run dynamics of inequality is anything that results in a statistical association between the wealth of parents and children. This statistical association may be enhanced by positive assortment in mating or in economic pursuits as occurs when skilled hunters pursue prey together, or when successful herders cooperate in livestock management. The same is true of increasing returns or other forms of positive feed backs, for example when those who invest a substantial amount earn higher than average returns, or when childhood developmental effects associated with modest genotypic differences result in substantial phenotypic differences. Negative feed backs, such as sharing norms that extract substantial transfers from the wealthy, or wealth shocks that are inversely correlated with one’s wealth , by contrast, heighten regression to the mean by reducing b, thereby attenuating the persistence of inequality over time and hence reducing steady-state inequality.

Our three wealth classes differ in the extent to which these transmission mechanisms—transfers, assortment, and positive feed backs in development or accumulation—are at work. Material wealth is readily transferred to the next generation by bequests sanctioned by cultural rules. Moreover, because it is typically observable, material wealth can facilitate deliberate marital or economic assortment. For some types of material wealth , the correlation of material wealth levels across generations is further enhanced by the presence of increasing returns to scale or other positive feed backs. Network ties can easily be passed from parent to child, but the offspring of less well-connected parents can usually gain access to allies and helpers more readily than a landless son in a farming community can acquire land, for example, through savings or systems of patronage. As a result we expect the inter generational transmission of relational wealth to be limited, at least by comparison with material wealth. Embodied wealth is transmitted by a combination of genetic inheritance, socialization, and parent-offspring similarity in the conditions affecting childhood development. The knowledge component of embodied wealth is readily transmitted to offspring, but,cultivar frambuesas unless restricted by religious or other constraints, it is typically available to other members of a population as well . Genetic and psychometric evidence from industrial societies suggests that parent-offspring transmission of economically relevant personality and behavioral characteristics, such as risk-taking, trustworthiness, conscientiousness, and extroversion is limited . We do not have similar evidence across generations in the small-scale populations under study, but industrial-society estimates support our expectation that the degree of inter generational transmission will differ markedly among our three wealth classes, with substantial transmission of material wealth and more limited transmission of relational and embodied wealth. Ethnographic evidence suggests that the four economic systems also differ in the importance of the three classes of wealth. A successful hunter gatherer or horticulturalist depends heavily on his or her strength, practical knowledge, and social networks, while making little use of material resources that are not in the public domain. By contrast, the well-being of a herder or farmer is closely tied to the amount of stock or land under his or her command, which makes material wealth a more important influence on livelihoods in these economic systems.To estimate our model of wealth transmission, we need two pieces of information: the degree of inter generational transmission for each wealth type and the importance of each wealth class in a given economic system . Note that we do not require identification of the causal paths by which transmission takes place, as might be represented in a multi-equation structural model . Our model instead requires a single estimate of the magnitude of the statistical association between parental and offspring wealth for each data set. This requirement, along with the absence of robust evidence of non-linearities, motivated our consistent use of linear models. Functional forms, estimation procedures, robustness checks, weighting procedures, and other aspects of our statistical techniques and results are described in , section 1. Note that the populations studied were not selected at random; instead, we included all populations we were aware of for which inter generational wealth transmission estimates are feasible and the researchers agreed to share data. Table 1 presents our individual estimates of b; Table 2 presents the summary statistics for both the inter generational transmission and the importance of the three wealth classes in the four economic systems.

Across the four economic systems, the estimated b for 14 measures of material wealth, including agricultural and horticultural land, livestock, shares in sea mammal–hunting boats, quality of housing, and household utensils averages 0.37 . For farm land , the degree of transmission is substantial, averaging 0.45 , thus equaling or exceeding the inter generational transmission of most forms of wealth in modern industrial economies . Livestock are even more highly transmitted across generations . Our 23 estimates of the transmission of embodied wealth across generations average 0.12. The highest estimates are for body weight . We also find a very modest level of inter generational transmission of reproductive success ; it is entirely absent in three societies, has a maximum value of 0.21, and averages 0.09, similar to low correlations between parental and offspring fertility in many pre-demographic transition populations . Grip strength is weakly transmitted across generations. The transmission of hunting success is highly variable , averaging 0.17. Knowledge and skill, such as the production and management of horticultural crops in the Pimbwe or proficiency in subsistence tasks and cultural knowledge in the Tsimane, are only weakly transmitted from parents to offspring. The six estimates of relational wealth transmission indicate that the extent to which network links are transmitted across generations is modest, averaging b = 0.19. To measure the importance of each wealth class in the four economic systems we used ethnographers’ judgments of the percentage difference in household well-being associated with a 1% difference in the amount of a given wealth class, holding other wealth classes constant at the average for that population, and requiring these percentage effects to sum to one. The average values of a by wealth class and economic system also appear in Table 2. Consistent with descriptive ethnographies of these and other populations, embodied and relational wealth are relatively important for hunter-gatherers, whereas material wealth is key in pastoral and agricultural populations. Statistical estimates of the importance of each class of wealth across the economic systems would have been preferable, but are precluded by the absence for most populations of a single relatively homogeneous measure of well-being. However, we were able to econometrically estimate m—the importance of material wealth—from an equation similar to using data from populations not represented in our study, including one horticultural, two pastoral, and seven small-scale agricultural economies. These estimates [see section 1] are close to our ethnographers’ estimates and suggest that, if anything, we have understated the difference in the importance of material wealth between pastoral and agricultural economies, on the one hand, and horticultural economies on the other. Correcting this understatement would only strengthen our main conclusions.Our first finding is that the a-weighted averages of the b values for the four economic systems differ markedly . Inter generational transmission of wealth is modest in hunter-gatherer and horticultural systems and substantial in agricultural and pastoral systems. However, even the smaller b values of the former imply that being born into the top 10% of the wealth distribution confers important advantages. In these societies, a child of parents in the highest wealth decile is on average more than three times as likely to end up in the top decile as is the child of the bottom decile. Although hardly a level playing field, inter generational transmission in these economic systems is modest when compared with the agricultural systems, where the child of the top decile is on average about 11 times more likely than the child of the poorest decile to end up in the richest decile, or to the pastoral systems, where the ratio exceeds 20.