Abstract

Inheritance is the chief mechanism transmitting wealth across generations, and wealth is well established as a protective resource for health, yet studies find weak or negative associations between inheriting and mental health. I argue this puzzle reflects a bundling problem: an inheritance is a parent’s death viewed from the heir’s side, so a protective transfer and a bereavement shock arrive together, and existing designs estimate only their net effect. Theoretically, I bridge the literatures on wealth stratification and bereavement, recasting inheritance as a wealth event whose buffering capacity should surface in medium-run recovery rather than at impact. Empirically, I develop a triple-difference design resting on a regularity of inheritance law: at the first parental death (FPD) spousal protections keep the estate with the surviving spouse, and only at the second (SPD) does it pass to the adult children. I fix heir status once, on receipt at SPD, and follow heirs and non-heirs through both deaths, so that change from FPD to SPD isolates the wealth transfer. I estimate it in three representative longitudinal surveys: the German SOEP (2002–2021), the US PSID (2001–2021), and the Swiss SHP (1999–2024). In no country does inherited wealth ease the acute shock. In Germany, a substantial medium-run buffer emerges at SPD; the US and Swiss estimates show no buffer of comparable size. Inheritance thus converts the intergenerational transmission of wealth into an intergenerational transmission of coping resources, stratifying recovery from a nearly universal life-course event. While the present study is limited to mental health, the same design could trace the consequences of inheritance across other health dimensions and over a longer horizon.