The Wealth (Disadvantage) of Single-Parent Households

• DOI: http://doi.org/10.1177/00027162221123448
• Published date: 01 July 2022
• Date: 01 July 2022
• Subject Matter: Across the Income Distribution and Wealth

188 ANNALS, AAPSS, 702, July 2022

DOI: 10.1177/00027162221123448

The Wealth

(Disadvantage)

of Single-Parent

Households

By

SALVATORE MORELLI,

BRIAN NOLAN,

JUAN C. PALOMINO,

and

PHILIPPE VAN KERM

1123448ANN THE ANNALS OF THE AMERICAN ACADEMYTHE WEALTH (DISADVANTAGE) OF SINGLE-PARENT HOUSEHOLDS

research-article2022

Wealth is a buffer against economic shocks and the

intergenerational transmission of disadvantage. We

investigate the wealth of single-parent households in

six high-income countries that span a variety of institu-

tional contexts and welfare regimes. Using household

survey data, we show that single-parent households in

all these countries are disadvantaged in the wealth

they hold, compared to dual-parent households—

more so in Great Britain, France, Germany, and the

United States; and less so in Italy and, especially,

Spain. We tease out major differences in types of

wealth holdings in single- and dual-parent households.

We find that the single-parent wealth deficit is not

explained by differences in age or number of children

but that it is influenced by education, income, home-

ownership, and receipt of intergenerational transfers.

We discuss the policy implications of our findings, both

in terms of how single parents are treated in social

protection and taxation systems and, more broadly, in

the supports they require if they are to overcome bar-

riers to accumulating wealth.

Keywords: wealth; single parents; intergenerational

transmission; homeownership; savings

Household wealth plays a key role in coping

with economic shocks and with the inter-

generational transmission of advantage and

disadvantage. The vulnerability associated with

having little or no property wealth or financial

Salvatore Morelli is an Assistant Professor in public

economics at the Law Department at the University of

Roma Tre (Rome), a senior scholar and director of the

GC Wealth Project at the Stone Center on Socio-

Economic Inequality at the Graduate Center of the

City University of New York, and a research associate

at the Centre for Studies of Economics and Finance at

the University of Naples, Federico II.

Brian Nolan is a Professor of social policy and director of

the Employment, Equity, and Growth Programme at the

Department of Social Policy and Intervention and the

Institute for New Economic Thinking and Senior

Research Fellow at Nuffield College, University of Oxford.

Correspondence: brian.nolan@spi.ox.ac.uk

THE WEALTH (DISADVANTAGE) OF SINGLE-PARENT HOUSEHOLDS 189

buffer to fall back on is particularly salient in a major economic shock such as the

ongoing COVID-19 pandemic crisis (Kuypers etal. forthcoming). The long-term

implications of parental wealth or its absence for progress through the education

system and the labor market are also now better understood (Pfeffer 2018).

Among the many challenges faced by single parents, the presence of a wealth

deficit among them (compared with dual-parent households) would represent a

major additional disadvantage, one that would carry serious implications for cur-

rent living standards and economic security and for the well-being of their chil-

dren and opportunities that are available to them.

Some single-country studies have suggested that single parents do indeed face

a wealth deficit compared to dual-parent households (e.g., Lersch etal. 2021), as

do the few studies that have adopted a comparative perspective (Sierminska,

Smeeding, and Allegrezza 2013; Sierminska 2018). Here we probe the household

wealth situation of single-parent households in six rich countries and highlight

insights into the processes that might contribute to household wealth differen-

tials. We employ data from high-quality household wealth surveys to compare the

wealth of single- versus dual-parent households in France, Germany, Great

Britain, Italy, Spain, and the United States, countries spanning a variety of eco-

nomic trajectories, institutional contexts, and welfare regimes. We then disag-

gregate wealth into its main components and explore the prevalence of key forms

of household wealth, including principal residence (for homeowners), other

property, physical wealth, and financial or business assets: these analyses show

where the major divergences between single- and dual-parent households arise.

We then probe the relationship between the wealth penalty of single-parent

households and a set of relevant sociodemographic characteristics including age,

number of children, and education. Finally, we assess the role played by direct

transfers of wealth from the previous generation as potentially explanatory of

wealth gaps among single- versus dual-parent families: we do this for both higher-

income and lower-income households, exploiting data on receipt of inheritances

and gifts also obtained in these surveys. The policy implications of the findings

are then addressed, both with respect to how single parents are treated in social

protection and taxation systems and more broadly in terms of the supports they

require to overcome the barriers to accumulating some wealth.

In brief, our key findings are that single-parent households are, on average,

disadvantaged in terms of current wealth levels and that this disadvantage is suf-

ficiently substantial to have major implications for the children growing up in

those households. This is due to both the reduced likelihood of single parents

Juan C. Palomino is a postdoctoral research officer at the Department of Social Policy and

Intervention and the Institute for New Economic Thinking (INET) at the University of Oxford,

and Research Scholar in the Department of Economics at the Complutense University Madrid.

Philippe Van Kerm is a Professor of social inequality and social policy at the University of

Luxembourg on a joint appointment with the Luxembourg Institute of Socio-Economic

Research (LISER), and is a fellow at the Institute for Social and Economic Research (University

of Essex), the Institute for New Economic Thinking (University of Oxford), the Stone Center

on Socio-Economic Inequality (City University of New York), and ZEW Mannheim.