This paper analyzes the economic consequences of family break-ups on women's household income using fixed effects panel regression on German (SOEP) and US American (PSID) panel data. Since Germany and the United States are two examples of opposing social models, reflected in their policy framework regarding family break-ups, country differences in the economic consequences are assumed. The cross-national comparison shows that the welfare state effect is higher for women in Germany. Over time, the effect decreases only slightly in Germany, whereas the decline is more distinct for US women.
JEL Classifications: J12, J16* This paper originates from work for the project "The Economic Consequences of Key Life Risks in Germany and the US and their Evolution since the 1980s" (Life Course Risks), funded by the Deutsche Forschungsgemeinschaft (DFG). I wish to thank my colleagues from the Life Course Risks project -
This chapter examines the earnings trajectories of divorced mothers in Germany. It explores earnings changes around the time of divorce, and investigates how the gendered division of work and employment patterns during marriage affects the post-divorce earnings of women with children. The data come from the German Statutory Pension Register, which provides monthly employment and earnings histories as of age 14, as well as complete fertility biographies and marriage histories for the divorced women we study. The analytical sample of this study contains 6850 women with minor children who entered the divorce process between 1992 and 2013. The analysis shows that the mothers’ earnings increased around the time of divorce, and that the mothers of the most recent divorce cohort had higher earnings than the mothers of the earlier divorce cohorts. Despite these increases, the divorced mothers earned only 40% of average earnings. The mothers’ earnings patterns during marriage and the ages of their children explain a large share of these earnings patterns after divorce.
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