Economic Consequences of Divorce: A Review

Abstract

The consequences of a relationship break-up span a wide range of foreseeable and unforeseeable effects in the life courses of adult individuals, their parents, and their children. One consistent finding in the divorce literature concerns the gender gap in the financial consequences of divorce. While there are huge international differences, it appears that in every country, women are economically disadvantaged following a divorce. Men tend to lose little or no income after a divorce, while the financial losses for women can be substantial. In this chapter, we provide an overview of the financial consequences of union dissolution. We thereby consider both divorces and break-ups of unmarried cohabitating partners. First, we focus on the magnitude of the decrease in financial resources and the moderating effects of welfare state benefits. Second, we look at the coping strategies women employ to make up for their income losses. Third, we look at the position of lone mothers. Being a lone parent after a break-up turns out to be a very difficult situation, as the chances of ending up in poverty are high for single parents. Again, welfare states react quite differently to the challenges faced by lone parents, which results in a differential poverty risk for lone parents across countries.

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23© The Author(s) 2020
M. Kreyenfeld, H. Trappe (eds.), Parental Life Courses after Separation and
Divorce in Europe, Life Course Research and Social Policies 12,
https://doi.org/10.1007/978-3-030-44575-1_2
Chapter 2
Economic Consequences ofDivorce:
AReview
DimitriMortelmans
Introduction
In the social sciences, empirical results are often inconclusive or contradictory, as
different studies may, for example, use different concepts, measurements that are
more or less sophisticated, or data that are not completely comparable. In this chap-
ter, we look at an exception to this prevailing pattern. This review article tells the
story of the nancial consequences of relationship break-ups. As will become clear
throughout the chapter, one central nding dominates the research on this topic:
namely, that in nancial terms, women suffer more than men from a break-up. There
are, of course, many nuances to this general nding. For example, as McManus and
DiPrete (2001) have pointed out, it is a myth to think that men never lose nancially
from a divorce.
Previous research on the consequences of divorce has primarily focused on how
children are affected by marital dissolution and partnership breakdown. In their
review article, Amato and Keith (1991) identied no less than 15 different areas of
life in which children are affected by divorce (e.g., conduct, academic achievement,
parent-child relationships, social adjustment). For adults, similar domains, such as
social networks, loneliness, or health, have also been studied (Mortelmans 2019).
The economic situation of an individual after a divorce is key, because it affects
other domains of the person’s life course, and particularly his/her health and wellbe-
ing. Financial difculties following the end of a relationship are attributable not
only to a loss of economies of scale. Indeed, money problems in the wake of a
break-up may be caused by many other challenges in the personal lives of the ex-
partners, and of their family members and friends.
D. Mortelmans (*)
University of Antwerp, Antwerp, Belgium
e-mail: dimitri.mortelmans@uantwerpen.be

24
In this chapter, we rst examine the magnitude of the nancial consequences of
divorce. Many authors have produced estimates of the decrease in income after
relationship dissolution. Despite the overall gendered conclusions in all of these
studies, we will map the difculties that can arise when investigating these income
trajectories. Next, we will focus on coping strategies. When confronted with nan-
cial losses, it is unrealistic to assume that people will react passively. Instead, people
tend to develop strategies for coping with these losses in an effort to regain their
pre-break-up income levels. Finally, we will look at the nancial consequences of
lone parenthood. Even though divorcees with and without children face nancial
losses, most studies have found that the presence of children places additional nan-
cial burdens on the ex-partners, and particularly on the mother, who usually contin-
ues to live with the children.
It’s theMeasurement, Stupid!
Although all of the results on the nancial consequences of union dissolution point
in the same direction, the ndings regarding the magnitude of the nancial draw-
backs of divorce for women (and for men) differ substantially. Studies have found
differences both between and within countries, and across time. To gain more
insight into the nancial consequences of relationship dissolution, we need to take
these differences into account. Thus, before we can tackle the actual percentages of
income lost (or gained) presented in these results, we must address some method-
ological issues.
The rst issue that we need to clear up is what kind of event are we looking at.
Most studies simply consider the functional end of the relationship– i.e., the point
at which the partners are no longer living together– as the event to be studied (for
an overview, see: Andreß etal. 2006; McKeever and Wolnger 2001). For mar-
riages, we found no study that took the actual legal divorce as the turning point
when studying the nancial consequences of the break-up, as legal procedures can
take a long time in many countries. For this reason, the actual split of the household
is considered a more realistic and common point of reference. A similar approach is
used in studies that include cohabitations. From the earliest study onwards (Avellar
and Smock 2005), the split of a cohabiting relationship has been understood to rep-
resent the end of the relationship. Even when couples are legally cohabiting (in
those countries where this is possible), the same conceptualisation is used as the
point of divorce. Thus, when we use the term divorce in this chapter, we are actually
referring to the split of the household (i.e., the point at which the two partners stop
living together), and never to the legal reality that accompanies this process. As a
side note, most studies that rely on longitudinal data use a yearly measurement of
the household composition, which implies that splitting up in January or in
December is considered as the same event.
A second issue that must be addressed is the way in which income is measured.
Most studies use data on household income, rather than on individual income. The
D. Mort elma ns

25
reasoning behind this approach is that it makes more sense to get an estimate of
disposable income, rather than of earnings from labour (van Damme etal. 2009).
The household income is composed of all nancial contributions from all household
members both before and after the break-up. Generally included are income from
labour, assets, and public and private transfers (including child and spousal sup-
port); while taxes and payable maintenance expenses are deducted (Andreß etal.
2006; Bayaz-Ozturk etal. 2018). In some cases, split analyses are done on income
components derived from public transfers (e.g., welfare support), and from private
sources such as labour (de Vaus etal. 2017). When register data are used, the mea-
surement of household income usually relies on more restricted information, as
child maintenance transfers or assets are often not available in administrative data.
In this case, household income is usually dened as the sum of social security-based
income sources, such as labour income and welfare benets (de Regt etal. 2012;
Tamborini etal. 2015).
There are clear nancial benets for couples who live together, as certain
expenses can be shared (housing, food, etc.). Additionally, the added cost of living
for an extra person in the household is lower than the original cost. These economies
of scale are lost after a break-up, and need to be taken into account when looking at
the income trajectories before and after the dissolution. This is why most studies do
not simply use household income, but instead use equivalized household income to
measure the income levels of ex-partners. In this measurement approach, the total
household income is equivalised based on the composition of the household
(Atkinson etal. 1995). Two types of equivalence scales are commonly found in the
literature. The rst is the OECD modied equivalence scale (Förster 2007), which
uses a unity weight for the rst adult and a weight of 0.5 for each additional adult.
Children are weighted with a value of 0.3. This scale was created by Hagenaars
etal. (1994), and was adopted by the OECD and Eurostat. The second is the Square
Root Scale, which simply divides the household income by the square root of
household size. The difference between these scales is expressed as “equivalence
elasticity” (Förster 2007) ranging from zero (unadjusted household income) to one
(per capita household income). The OECD modied equivalence scale has an elas-
ticity of 0.53, and the square root scale reaches a similar elasticity value of 0.50.
Financial Losses After Divorce
Following these methodological clarications, we look at the actual decline in the
ex-partners’ nancial resources after a break-up. Most studies report the percentage
decrease in income from the year before the break-up to one year after the break-up.
In addition to differences in the methodological choices made and in the data used,
two dimensions seem to determine the differences in the sizes of the economic con-
sequences reported in the literature: time and geography. We illustrate these differ-
ent approaches by providing an overview of studies on this topic across time for the
US (from 1960 until today), and then for the European context (from the 1990s until
2 Economic Consequences ofDivorce: AReview

26
today). As we mentioned above, the results are always compared by gender, as the
consequences of divorce for women tend to differ substantially from those for men.
Divorces
The oldest results from the US were reviewed by Smock (1993), who reported that
nancial losses for women were found in studies from the 1970s and 1980s.
Conversely, in this same period, increases in equivalent household income were
observed for men. In her own study, which used longitudinal panel data from the US
to compare divorce cohorts from the 1960s and the 1980s, Smock observed nan-
cial losses for white women of between 46% (oldest cohort) and 43% (1980s
cohort), and for black women of between 51% and 45%. She also found that nan-
cial losses for white men shifted from −7% in the oldest cohort to +7% in the
younger cohort; and that for black men, nancial losses increased over time from
13% to 29%. Around the same time, Burkhauser etal. (1991) found a loss in income
of 39% among women and of 7% among men. In their analysis of the nancial
losses associated with divorce in the US in the late 1990s, DiPrete and McManus
(2000) reported that the adjusted household income loss was 15% for men, com-
pared to 26% for women. The most recent results also show a substantial decline in
income among women. For women in the US, Hauser et al. (2018) reported a
decrease of 25%, while de Vaus etal. (2017) reported a decrease of 30%. These
results are comparable to those found in the 1990s and 2000s. Some studies that
took only individual household income into account showed a divergence of income
between US women and US men. Investigating labour earnings, Tamborini etal.
(2015) reported that women’s earnings increased over time during the post-divorce
period, and that the nancial losses they suffered after divorce subsequently
decreased. Unfortunately, this study did not take the household income into account,
which makes it difcult to compare these ndings to those of other studies.
The results for Europe are somewhat comparable to those for the US, as they
show that women tend to lose nancially while men display a more diverse pattern
of gains and losses (Andreß et al. 2006). Results across time are available for
Germany (often in comparison with the US) and the UK. In the oldest studies,
German women were found to have income losses of 44% (Burkhauser etal. 1991),
32% (Andreß etal. 2006), and 25% (Uunk 2004). This trend seems to be relatively
stable over time, as more recent ndings show a drop in income for women of 26%
(Hauser etal. 2016) and 35% (de Vaus etal. 2017). German men, on average, have
been shown to lose much less in terms of equalized household income: i.e., they
were found to have income losses of 7% (Burkhauser etal. 1991), 2% (Andreß etal.
2006), and 23% (DiPrete and McManus 2000). The most recent ndings indicate
that German men may even gain nancially after divorce, albeit modestly (<5%) (de
Vaus etal. 2017; Hauser etal. 2016). For the UK, the oldest results point to a sub-
stantial decline in income for women, ranging from 26% (Uunk 2004) and 27%
(Dewilde 2003) to 18% (Jarvis and Jenkins 1999). Shifts over time were again
D. Mort elma ns

27
found to be fairly limited, as de Vaus etal. (2017) found a 25% decrease in women’s
equivalent household income based on the most recent available panel data. The
results for other European countries are comparable, displaying the same pattern of
substantial losses among women and small losses or gains among men (Andreß
etal. 2006; Uunk 2004).
Cohabitations
With regard to the dissolution of cohabiting unions, we expect to nd that the nan-
cial losses are more modest. First, compared to married couples, cohabiters tend to
have a more equal division of paid work (Snoeckx etal. 2008). Thus, married
women are more likely than cohabitating women to be nancially dependent on
their partner. Second, cohabiters are less likely to have children, and they tend to be
younger when ending a relationship (Batalova and Cohen 2002; Brines and Joyner
1999; Hamplova 2002; Rindfuss and Vandenheuvel 1990; Wu and Schimmele
2007). As we will discuss in more detail later in this chapter, having dependent
children is disadvantageous for income trajectories after a break-up. Furthermore, a
number of important (indirect) costs are involved with childrearing that can indi-
rectly affect a woman’s nancial status (e.g., staying home to care for her children
instead of being active on the labour market).
While most studies consider previously married partners, far fewer results on
post-dissolution income trajectories are available for previously cohabiting part-
ners. The oldest study on the economic consequences of the dissolution of cohabi-
tating relationships was conducted in the US by Avellar and Smock (2005). They
found that previously married men gained in equalized household income (+11%),
while formerly cohabitating men lost a small percentage of their income (−1.8%).
The losses of previously cohabiting women were shown to be more limited (−24%)
than those of previously married women (−48%). For the Netherlands, Manting and
Bouman (2006) found that the post-relationship decline in economic well-being
was greater for divorced women (−23%) than for formerly cohabitating women
(−14%). The economic consequences of relationship dissolution were shown to be
more severe for formerly cohabitating men (−4%) than for divorced men (+7%).
Using Belgian register data, de Regt etal. (2012) also found a more substantial drop
in income for divorced women (−33%) than for cohabiting women (−22%). Over
time, there have been fewer studies on this issue that allow us to compare and
observe trends. However, for the US, Tach and Eads (2015) observed a diminishing
gap in income losses between divorced and formerly cohabiting ex-partners. They
argued that for US women, the consequences of divorce have become more positive,
but the consequences of the break-up of a cohabiting relationship have become
more negative. They explained this surprising nding by pointing to the changing
composition of both married and cohabiting couples in terms of economic back-
ground. In the US, married households have become economically stronger and are
more likely to have two earners, while cohabiting households tend to be situated at
2 Economic Consequences ofDivorce: AReview

28
the lower end of the income distribution. Furthermore, the repartnering market has
changed signicantly, with more disadvantaged divorcees tending to cohabit instead
of remarrying.
Individual andInstitutional Differentials inConsequences
The most important divide in the nancial consequences of relationship dissolution
is clearly between women and men. There is, therefore, a large body of research on
the factors that might explain these gendered income trajectories. At the individual
level, labour market participation appears to be the main explanatory factor. Married
women have lower levels of labour market attachment, as many of them are not
working or are working part-time. In a classic male breadwinner model, the hus-
band works and the wife cares (more) for the children (Becker 1981), which leads
to a specialised division of labour in the (former) couple. When the relationship
ends, the woman often has less human capital than the man, especially if her labour
market skills have depreciated while she stayed home to do the housework and care
for the children. A second important explanatory factor is the presence of (young)
children in the household. Having children not only limits a woman’s opportunities
to participate in the labour market (see further), it also limits a woman’s time
resources, and makes it more difcult for her to divide her time between child care,
housework, and paid labour. In addition, if the mother has physical custody of the
children, her household may have greater economic needs (Raeymaeckers
etal. 2008a).
When we look at the relative declines in equalized household income for men
and women at the individual level, we see marked differences between countries.
Institutional factors have a clear and substantial additional impact on the nancial
consequences of union dissolution. For both women and men, the economic conse-
quences of divorce differ not only over time, but by country and geographic region.
Some studies have compared pairs of countries, and have focused on the specic
differences between them (e.g., Burkhauser etal. 1991; Dewilde 2006). Others have
performed large-scale comparisons of multiple countries (Andreß etal. 2006; de
Vaus etal. 2017; Uunk 2004). In such broad comparisons, country differences are
often explained using welfare state typologies (e.g., Esping-Andersen 1990;
Ferragina and Seeleib-Kaiser 2011). A rst general conclusion we can draw from
these comparative studies is that there are institutional inuences that go beyond the
compositional differences between countries (Uunk 2004). While household size
and labour market attachment patterns differ between countries, the institutional
context also has an impact on the nancial consequences of divorce for women (for
men, hardly any study has considered institutional factors). In terms of the decline
in income, a clear north-south gradient is observed throughout Europe, with a break-
up having a smaller average effect on income in the Scandinavian countries than in
the Southern Europe. In most studies, the impact of three different institutional poli-
cies is reviewed: income-related welfare provisions (e.g., social welfare),
D. Mort elma ns

29
employment-related policies, and family policies (e.g., child care provisions). Both
Uunk (2004) and de Vaus etal. (2017) concluded that social welfare (direct income-
related measures) has the largest impact on the post-divorce income trajectories of
women. The provision of child care can also help women remain active in the labour
market, which could, in turn, raise their income. Nevertheless, multivariate analyses
have shown that the effect of direct income support outweighs that of child care
payments. This nding is consistent over time. Receiving income support might
have negative consequences for the life course of a divorced woman, as it may cre-
ate a “welfare trap” that discourages her from participating in the labour market.
This lack of labour market attachment could also negatively affect the woman’s
income position later in life, as her pension rights will be substantially reduced.
Coping Strategies (for Women)
A second way of approaching the economic consequences of a break-up is to look
not at the loss in resources, but at the subsequent recovery. When we apply a life
course framework, we can see that people’s lives do not halt after a break-up. The
sociology of the life course stresses that there are temporal shifts in people’s lives
(Mortelmans etal. 2016). This implies that life goes on after divorce, and that peo-
ple take action when confronted with adversity. Looking at the post-break-up strate-
gies of former partners inevitably brings us to the concept of coping strategies. A
coping strategy is dened as “a behavioural pattern of an actor to deal with prob-
lems, referring to the usual and institutionalized ways of feeling, thinking and acting
in such situations” (Boeije and Nievaard 1995: 350). When examining the nancial
coping behaviour of ex-partners after a divorce, we can discern two main coping
mechanisms: nding a new partner and changing one’s labour market behaviour.
Both strategies are known to positively inuence the nancial well-being of an ex-
spouse. A third potential strategy that is sometimes considered is returning to the
parental home, also termed the “boomerang effect” or the “boomerang move”
(Albertini etal. 2018).
Repartnering
The rst coping strategy might be somewhat controversial. Coping as a concept
entails an intentional behavioural component. Unlike (re-)employment, repartner-
ing cannot be seen exclusively as an intentional strategy to alleviate the nancial
drawbacks of a break-up. A new relationship might offer not just nancial security,
but the fullment of the need for friendship, affection, and love. Nevertheless, as
this pathway can be seen as a mechanism for alleviating nancial pressures after the
break-up, it can be considered a coping strategy.
2 Economic Consequences ofDivorce: AReview

30
In the literature, we nd three arguments that can help us understand the likeli-
hood of nding a new partner after a break-up: needs, opportunities, and attractive-
ness (de Graaf and Kalmijn 2003). These three components cannot be seen as
independent of each other, and have been jointly taken into account in studies that
map repartnering processes. The need argument refers to the nancial, emotional,
and social needs people are seeking to meet by entering a new relationship. The
opportunities argument is based on the observation that people need to be able to
meet new partners in order to form a new bond. The greater the opportunities people
have to meet partners, the higher their likelihood of nding a match, and the higher
their odds of repartnering. The “rst marriage market” is generally comprised of
schools and leisure locations where (young) people meet before they enter a long-
term relationship (de Graaf and Kalmijn 2003; Kalmijn 1998). After the break-up of
a long-term relationship, people enter the “second marriage market”, where the
opportunities to meet a new partner are more limited. The third argument concerns
the attractiveness of people on the repartnering market. This term does not refer
exclusively to “physical attractiveness”. Especially on the second marriage market,
characteristics such as the presence of children from a prior relationship or the
nature of the break-up itself are very relevant, as these factors can make people
more or less attractive to others (de Graaf and Kalmijn 2003).
The determinants of repartnering, such as the presence of children, sex, educa-
tional level, income situation, and age, can be interpreted in multiple and opposing
ways depending on which argument is applied to the repartnering process. Studies
that take repartnering into account as a coping strategy have observed different pat-
terns by gender, with men, on average, repartnering faster and more frequently than
women (Coleman et al. 2000; Lampard and Peggs 1999; Schmiege et al. 2001;
South 1991). While having (young) children may intensify a divorcee’s economic
pressures, it can also lower the individual’s repartnering chances because she has
decreased meeting opportunities and is considered less attractive. Conversely, hav-
ing a good job tends to improve a divorcee’s attractiveness and opportunities to meet
a partner, while also increasing the individual’s repartnering needs from a speciali-
sation logic point of view (Becker 1981; Becker etal. 1977). From a Beckerian
point of view, this dynamic only applies to men. For a woman, having a job reduces
her need to repartner for nancial reasons, and makes her less attractive (from the
classic Becker (1981) point of view), as she is less available to form a specialized
household with a single earner. Older divorcees tend to experience more difculties
than their younger counterparts in nding a new partner (de Graaf and Kalmijn
2003). This dynamic is also gendered in the sense that older women have lower
repartnering chances than older men, partly due to the tendency of men to marry
younger women (Schmiege etal. 2001). As we mentioned above, resident children
have a consistently negative effect on the likelihood of repartnering (Di Nallo 2019;
Pasteels and Mortelmans 2015; Sweeney 1997). Socio-economic factors inuence
the repartnering behaviours of both men and women, albeit in opposite directions.
For women, a non-signicant or a negative educational gradient has been found,
which appears to be related to an independence effect among higher educated
women (Ozawo and Yoon 2002). For men, it has been shown that their chances of
D. Mort elma ns

31
repartnering increase as their educational level rises. Finally, with respect to indi-
vidual earnings and labour market attachment, the results show evidence of a two-
tiered family system (Furstenberg 2016), whereby higher labour market activity
levels and higher earnings are associated with a higher probability of entering a new
partnership (Dewilde and Uunk 2008; Pasteels and Mortelmans 2017). In summary,
we can state that the effects of human resource determinants are more straightfor-
ward for men than for women. All of the arguments concerning needs, meeting
opportunities, and attractiveness move in the same direction for men, which is not
the case for women.
(Re-)employment
A second strategy described in the literature is working more or entering the labour
market (Joshi 1998; Poortman 2000). When a divorcee increases his/her labour mar-
ket activity in response to the breakdown of the relationship, his/her income posi-
tion is increased and his/her risk of poverty is reduced (Dewilde 2006). Not
surprisingly, women face more barriers to increasing their labour market activity
because their care burden often makes it difcult for them to work more (Stier etal.
2001; van der Lippe and van Dijk 2002). Also, the pre-break gender role patterns–
with women being more likely than men to have cared for their children at the cost
of their career– inuence the ex-partners’ ability to return to the labour market later
on. There are few detailed studies on the employment patterns of divorced men, as
most men were already working full-time before their relationship ended, and con-
tinued to do so thereafter (Thielemans and Mortelmans 2018). As Gornick etal.
(1998) put it, the majority of men do not suffer from the “child-penalty”.
In addition to this gender difference, the success of the (re-)employment coping
strategy has been shown to be dependent on various socio-economic and demo-
graphic determinants. Education is a logical differentiator, as the higher educated
are more likely than the less educated to have substantial work experience. In par-
ticular, higher educated women tend to work more than their less educated counter-
parts while married or in a long-term cohabitating relationship (Vanderheyden and
Mortelmans 2013). Age is also negatively related to this strategy, as human capital
depreciates with the length of time people (mainly women) are absent from the
labour market (van Damme etal. 2009). Another factor that can make it difcult for
women to increase their labour market participation is having to care for (young)
children. The more children there are in the household, and the younger the ages of
the children, the lower the probability that the mother will successfully (re-)enter
the labour market. Although women face the prospect of greater nancial losses
after a break-up (see above), and will therefore use this coping strategy more exten-
sively, it is not completely absent in the lives of men, as men may also experience
labour market setbacks (unemployment, periods of sickness) that lead them to
develop other labour market strategies (Kalmijn 2005; McManus and DiPrete
2 Economic Consequences ofDivorce: AReview

32
2001). Nevertheless, the sizes of these effects tend to be more limited for men than
for women.
The coping strategy of working does not operate independently of the strategy of
repartnering. Research has shown that when women combine the two strategies, the
benets of (re-)entering full-time employment outweigh the benets of repartner-
ing. Surprisingly, this effect was not found to be mitigated by education. Although
the higher educated tend to have a different pre-divorce position and are likely to
nd it easier to change their labour market position compared to their counterparts
with medium or lower educational levels, the labour market strategy was found to
have only a small effect and the repartnering strategy was found to have no effect. It
seems that repartnering, at least for women, has an equal effect on their post-divorce
income trajectories. For men, repartnering tends to improve their nancial circum-
stances– but again, this coping strategy does not appear to be as effective as enter-
ing either full-time or part-time employment (Jansen etal. 2009).
Returning totheParental Home
Compared to the repartnering and labour market strategies, the boomerang effect of
returning to the parental home has received far less attention in the literature as a
coping strategy for alleviating the nancial consequences of a break-up. This is
because the boomerang effect predominantly applies to young adults who return to
the parental home after taking an unsuccessful step towards independence (South
and Lei 2015). The interest in boomerang effects has grown in recent years, as the
global economic crisis led to dramatic changes in the housing trajectories of young
adults (Stone etal. 2014). Following the emergence of this new interest in the litera-
ture, researchers started turning their attention to boomerang effects later in the
life course.
Two life course events are closely related to boomeranging: namely, becoming
unemployed and experiencing the break-up of a relationship. Nevertheless, as most
studies that have examined these effects have focused on young adults, they have
mainly taken only short or middle-long relationships into account. However, return-
ing to the parental home can also be used as a coping strategy to manage nancial
setbacks after a long-term relationship ends. Far fewer studies have examined such
cases (Albertini etal. 2018; Guzzo 2016). Our knowledge about this coping strategy
is therefore still limited, especially compared to our knowledge about the two previ-
ously described strategies. Again, the gender differences in the strategies used for
coping with nancial challenges also apply to the return to the parental home, with
men having a higher probability of boomeranging. This may seem counterintuitive
given the evidence that daughters receive more help from their parents than sons in
difcult times (Fingerman etal. 2009). This nding may be explained by results
showing that a larger share of women (and especially mothers) than men stay in the
couple’s home after the break-up (Ongaro etal. 2008; Stone etal. 2014; Sullivan
2007). An individual’s labour market status and income position are also closely
D. Mort elma ns

33
connected to this coping strategy: if an individual’s nancial challenges are less
severe (because the person has a higher income or is in full-time employment), the
chances are greater that s/he will remain independent (Guzzo 2016; Kleinepier etal.
2017). Moreover, whether a divorcee uses returning to the parental home as a cop-
ing strategy depends not only on the characteristics of the former partner, but on the
characteristics of the parental home itself (Stone etal. 2014). It is, of course, the
case that the nancial resources of the parents and the availability of a room in the
parental home determine whether it is possible for the divorcee to return home
(Goldscheider and Goldscheider 1998). However, studies have also shown that cul-
tural factors, such as shared values or strong social and emotional ties in the family,
increase the likelihood of returning (South and Lei 2015).
Lone Parenthood andPoverty After Divorce
As we have explained above, a woman’s economic well-being after a relationship
fails may be negatively affected if she has primary responsibility for her children
(and is thus in a classic mother-centred custodial arrangement) (Poortman 2000).
First, the presence of children increases the economic needs of the family (as mea-
sured in equivalence scales in statistical models). Second, having children affects a
woman’s labour market options (Drobnic 2000; Raeymaeckers et al. 2008b;
Thielemans and Mortelmans 2018) and her attractiveness in the remarriage market
(Buckle etal. 1996; Coleman etal. 2000). As this book focuses on parental trajec-
tories after union dissolution, we have added an exploration of this issue to our
review. While we cannot provide a comprehensive overview of the difculties lone
parent families experience,1 we can offer some general insights into the nancial
situations of lone parents. The issue of poverty is thus a leading theme in this
section.
All of the studies that have examined the nancial consequences of relationship
dissolution have found that the income declines are greater and the recovery periods
are more difcult and more protracted among parents (especially mothers) than
among childless individuals (e.g., Jarvis and Jenkins 1999; Mortelmans and Jansen
2010). Therefore, the focus of the research on the nancial consequences of divorce
for parents moves to the issue of poverty2 for the partner who takes care of the
couple’s children after the break-up (in most cases, the mother). It has been
1 For a more comprehensive overview of lone parenthood, see Bernardi and Mortelmans (2018)
and Nieuwenhuis and Maldonado (2018).
2 Poverty in these studies is dened as a percentage (usually 60%) of the median net household
equivalised income of the population. When the income drops below this threshold, the subject is
considered to be poor (Aassve etal. 2007). The EU has reformulated this 60% threshold as “at-
risk-of-poverty” (AROP), as more denitions of poverty have become available. This term is now
used in all recent studies, whereas the older studies used the term “poverty” to refer to this 60%
median income threshold (Hübgen 2018).
2 Economic Consequences ofDivorce: AReview

34
consistently shown that these lone parents have a substantially higher poverty risk
than the general population, and– in line with the overall story told in this chapter–
that this risk is greatest for lone mothers. Early research on the economic conse-
quences of union dissolution for lone mothers was conducted in the US in 2004
(Fitzgerald and Ribar 2004; Martin 2006), and was later replicated in other coun-
tries (Harkness 2018; Jenkins 2008; Treanor 2018). The highest at-risk-of-poverty
rates among lone mothers were reported in US studies: i.e., of 63% (without transfer
payments) and of 51% (with transfer payments) (Casey and Maldonado 2012).
Conversely, in European studies, the at-risk-of-poverty rates of lone mothers have
generally been found to be lower, ranging from 7% in Poland to 37% in Latvia. Low
at-risk-of-poverty rates for lone parents have also been reported for Sweden (15%),
Norway (16%), and the Netherlands (16%). The highest at-risk-of-poverty rates in
the European context have been reported for Eastern European countries like
Lithuania (32%) and Hungary (31%), and for Ireland (29%), Spain (27%), and Italy
(27%) (Hübgen 2018; OECD 2011).
Research on the determinants of these poverty risks falls within the larger eld
of poverty studies, with individual factors like relationship break-ups, age, and edu-
cational level being identied as risk factors (Brady and Burroway 2012; Misra
et al. 2007). In addition to applying this individual risk model, researchers are
increasingly taking into account the institutional factors that contribute to the at-
risk- of-poverty rates among lone mothers. As the number of lone mothers has
increased signicantly in recent decades (Bernardi etal. 2018a), policies directed at
alleviating poverty among lone parents have received substantial attention in the
research community (Aassve etal. 2007). A central theme in these welfare state
studies has been the debate about the universal provision of social rights versus the
use of targeted support. Universalism is a perspective that calls for social policies
that are directed at all citizens, and that seek to reduce economic inequality in gen-
eral. Targeted policies are directed at particular groups, such as lone parents (Zagel
and Hübgen 2018). An example of the rst approach is a policy that provides uni-
versal access to the health care system for all residents of a country. Some examples
of the latter approach are the welfare benets and the specic tax reductions lone
parents receive in some countries. In a broad comparison of OECD countries,
Bradshaw etal. (2018) found that the incomes of most lone parents are supple-
mented by benets. In countries like Ireland, the UK, Denmark, Sweden, and
Australia, these benets can amount to 40% of the household’s total income. Most
countries provide lone parent families with income-tested family benets together
with non-income-tested cash benets for children.
With regard to lone parents, two main goals of social policy measures can be
discerned. First, direct poverty measures are designed to ensure that lone parent
families remain above the poverty threshold. The aforementioned tax reductions
and enhanced family allowances clearly have this income-based objective in mind.
A second goal is to help lone parents become or stay active on the labour market,
and to balance working with managing their care burden. In a large comparative
study of policy measures and their effects on poverty among lone parents in OECD
countries, Bradshaw etal. (2018) found that cash transfers are highly effective in
D. Mort elma ns

35
reducing poverty and keeping people in the labour market. However, the broader
policy mix in each country must be taken into account. There are, for example,
countries that provide cash benets, but that also reduce the housing subsidies of the
families who receive these benets (Bernardi etal. 2018b).
Conclusion
In this review, we took an unorthodox path by starting with the overall conclusion:
namely, that women fare worse economically after a break-up than men. Throughout
the literature, this simple yet far-reaching conclusion is replicated again and again,
regardless of the time period, geographic focus, or methodology used. A surprising
nding of this review was that most studies found that these losses declined only
slightly over time, regardless of whether the couples were previously married or
cohabiting. Although the gender income gap is shrinking due to the growth in dual-
earner households and the increases in women’s earnings, the overall conclusion
that women are disadvantaged relative to men remains intact after almost ve
decades (Tamborini etal. 2015).
We have provided some additional nuance to this general conclusion by review-
ing the many studies that have been conducted on this topic. Countries can alleviate
this gap by actively supporting divorcees, and lone parents in particular. The welfare
state is an important source of (social) support– although the case could also be
made that the existence of the welfare state has made breaking up much more fea-
sible than it was in the past. Moreover, from a legal point of view, divorcing or leav-
ing one’s partner (and children) has never been easier.
The focus on economic consequences might give the impression that divorce is
detrimental only for women, and that only men gain from a break-up. This is, of
course, not the case. For example, the more intense contact between women and
their children through classic custodial arrangements tends to enhance the level of
contact and care exchanged later in life (Cooney and Uhlenberg 1990; Pezzin and
Schone 1999). For these reasons, it could be argued that over the long term, women
pay the greater nancial price following a break-up, while men pay the greater
social price.
What will the future bring? Given the recurring ndings on this topic, we can
realistically assume that the economic consequences of divorce will continue to
harm women more than men. While there are some indications that the dual-earner
family system is helping to reduce this gender gap, differences in earnings are likely
to remain. However, a new development that researchers will need to take into
account is the shift in custody arrangements. Increasingly, countries are abandoning
the idea that children should grow up with their mother after their parents’ break-up.
Joint physical custody legislation has been passed in a number of countries, and
continued joint parenthood arrangements for women and men are gaining ground
(Bastaits and Mortelmans 2016). Joint physical custody changes not only the child
support system (Claessens and Mortelmans 2018), but fathers’ responsibilities to
2 Economic Consequences ofDivorce: AReview

36
their children. When children are living a substantial amount of time with their
father under a joint physical custody arrangement, the father is obliged not only to
take on parenting responsibilities, but to shoulder nancial obligations. This shared
responsibility also opens up labour market opportunities for the mother, and may
therefore limit her nancial disadvantages. As the minds of legislators and judges
are slow to change, it may take some time before we see the equalizing effects of
joint custody in our data and models. Yet it appears that the sharing of parental
responsibilities has the potential to reduce the gendered results we have presented
in this chapter. We hope that in 10years’ time we will be able to start a new review
with the words: “There was a time when only women suffered nancially from a
relationship break-up”. Until then, we look to the welfare state to support families
in the wake of a break-up, and to take action to reduce the huge poverty risks women
and their children face today.
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