This paper examines the effects of family structure on the economic resources available to children, using family fixed-effects to control for unobservable characteristics of the family. The effects of divorce on the income and consumption of children born to two-parent households, and the effects of marriage on children born into single-parent households are both considered. In the long-run (six or more years after the most recent divorce) family income falls by 40 to 45% after divorce, and food consumption is reduced by 17%. Six or more years after the most recent marriage, income of children born to single parents rises by 50 to 57%, but there is no statistically significant increase in food consumption. These estimates are substantially less than the difference in income implied by cross-sectional comparisons of different family types. When income changes are measured according to time since the parents first divorce, there is substantial recovery in income, virtually all of which is explained by subsequent remarriages. Similarly, when we look at income several years after a parent's first marriage, the gain is 28 to 33%, reflecting the short-lived nature of many of these marriages.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
8786.
Length: Date of creation: Feb 2002 Date of revision: Handle: RePEc:nbr:nberwo:8786
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Find related papers by JEL classification: I3 - Health, Education, and Welfare - - Welfare and Poverty J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Greg J. Duncan & Saul D. Hoffman, 1985.
"Economic Consequences of Marital Instability,"
NBER Chapters,
in: Horizontal Equity, Uncertainty, and Economic Well-Being, pages 427-470
National Bureau of Economic Research, Inc.
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