Taxing Wealthy Dynasties Seen Backfiring in States Like New York

Taxing the dynastic wealth of billionaire families can sometimes backfire, particularly in states like New York that already have high income-tax rates.

Estate taxes prompt many super-rich residents to move to states without the levies, especially as they get older, according to a new study from economists Enrico Moretti and Daniel Wilson. However, because most billionaires stick around, the majority of states can impose an estate tax and still bring in more revenue than they lose.

The study, published in the May issue of the American Economic Journal: Economic Policy, offers ammunition to both sides of a policy battle raging ...