The Effect of Children on the Income Status of Female-Headed Households: An Intercountry Comparison

Abstract

AbstractThis chapter examines the degree to which the number of children lowers the income status of female-headed households. The US situation is compared with that of other industrialized countries. In the United States, female heads of households are relatively well educated, have a relatively larger number of children, and are more likely to work. At the descriptive level, their after-tax income status is the highest among those in these six countries. Yet, after public and private income transfers are distributed, their income status plunges to the second lowest, next only to Canadians’. In the Nordic and European countries, social policy interventions have improved the income status of households with children, particularly female-headed households. The provision of various forms of public income transfers, including children’s allowances, maternity benefits, Social Security benefits, unemployment insurance, and workers’ compensation, has effectively smoothed out the distribution of disposable household income, mitigating the impact of children on the income status of female-headed households in these countries.