Single Mothers’ Income in Twelve Rich Countries: Differences in Disadvantage across the Distribution

• DOI: http://doi.org/10.1177/00027162221120758
• Published date: 01 July 2022
• Date: 01 July 2022
• Subject Matter: Across the Income Distribution and Wealth

164 ANNALS, AAPSS, 702, July 2022

DOI: 10.1177/00027162221120758

Single Mothers’

Income in

Twelve Rich

Countries:

Differences in

Disadvantage

across the

Distribution

By

SUSAN HARKNESS

1120758ANN THE ANNALS OF THE AMERICAN ACADEMYSINGLE MOTHERS’ INCOME IN TWELVE RICH COUNTRIES

research-article2022

I examine how single motherhood affects income in

different quantiles of the distribution in twelve rich

countries. Using harmonized data from the Luxembourg

Income Study, I show how the distribution of income

for households headed by single mothers differs from

households with children that are headed by couples. I

show that there is a striking variation by country in the

influence of single motherhood on income at different

points of the distribution. In some countries, such as

the United Kingdom, single motherhood has a greater

effect on income at the top of the distribution than at

the bottom. In others, such as the United States, effects

are largest at the bottom of the distribution. I discuss

the role of employment and social policies in driving

differences between countries in the income penalties

associated with single motherhood across the

distribution.

Keywords: single mothers; distribution of income;

unconditional quantile treatment effect

models; state benefits; employment

Previous research has shown single mothers

to be less well off and at higher risk of pov-

erty than mothers in couples. While single

mothers face a high risk of poverty across rich

countries (Gornick and Jantii 2012), those in

the United States are thought to be at greater

risk than their peers in other advanced econo-

mies, given that in the United States there is a

Susan Harkness is Professor of social policy at the

University of Bristol, co-investigator at the ESRC

Research Centre for Micro-Social Change at the

University of Essex, and visiting professor at the Centre

for the Analysis of Social Exclusion, London School of

Economics. Her research examines how gender and fam-

ily structure affect labor market and income inequalites.

NOTE: I gratefully acknowledge funding from the

Economic and Social Research Council, United

Kingdom, through the Research Centre on Micro-

Social Change (MiSoC), grant number ES/S012486/1.

I would like to thank Zachary Parolin, Janet Gornick,

and Amanda Sheely for helpful comments.

Correspondence: s.harkness@bristol.ac.uk

SINGLE MOTHERS’ INCOME IN TWELVE RICH COUNTRIES 165

relative paucity of public transfers that are available to them(Brady, Finnigan,

and Hübgen 2017; Rothwell and McEwen 2017). In contrast, the same studies

show that the United Kingdom (UK) stands out for its success in reducing single

mother poverty, with the generosity of state benefits playing a critical role in its

success.

While cross-national differences in the overall risk of poverty for single moth-

ers have been widely studied, much less is known about how single mothers

wider economic circumstances differ. Indeed, single mother hood is likely to

affect household income across the income distribution; and while public trans-

fers may help alleviate poverty in broad terms, their influence further up the

distribution may be limited, particularly if the transfers are means tested. As a

result, countries with low poverty “penalties” to single motherhood, achieved via

redistribution through the tax-benefit system, may at the same time have large

income penalties. In other words, cross-country differences in poverty may tell

us little about differences in single mothers’ relative economic position.

One reason low rates of single-mother poverty may be accompanied by high

income penalties is because generous state benefits, which protect single mothers

from poverty, may come at the cost of reduced financial incentives for paid work.

Evidence from the late 1980s and 1990s shows a link between high rates of means

testing and the relatively low economic status of single mothers because they were

discouraged from working (Wong, Garfinkel, and McLanahan 1993; Dickens and

Ellwood 2003). Since then, tax credits, paid to those in employment on low-

incomes, have become an increasingly prominent feature of the tax- benefit system

in Anglo-European countries (Kenworthy 2015). While earning subsidies improve

the incentives of those with low earnings potential to enter employment, they are

frequently accompanied by high marginal tax rates, reducing incentives to work

longer hours or for greater pay (OECD 2018; Brewer and Hoynes 2019).

Moreover, if more generous benefits are offered, a greater number of people are

drawn into means testing. For example, in the UK, while generous government

transfers have been crucial for reducing single-parent poverty, few single parents

escape means testing; in 2019–2020, 84 percent of single parents were estimated

to be entitled to the main means-tested benefit supporting low-income working-

age families: Universal Credit (Waters and Wernham 2021).

These tensions in the tax-benefit system means that high benefit levels, which

protect single parents from poverty, reduce the financial incentives of single

mothers further up the income distribution to go into paid work. Consequently,

in countries such as the UK, where the benefit system has been effective at

reducing single-parent poverty, low levels of poverty may not translate into single

mothers having higher relative economic status. Instead, generous means-tested

benefits may have the effect of compressing the distribution of single mothers’

income so that while single mothers may avoid poverty, their incomes may still

fall far below those of couples with children. In comparison, in countries where

non-means-tested benefits are generous, there will be fewer distortionary effects

on employment, and single mothers may have higher earnings and income

(Wong, Garfinkel, and McLanahan 1993; Brady and Burroway 2012), although

inequality among single mothers may be greater.