Economic consequences of union dissolution in Italy: finding from the European Community Household Panel

Union dissolution is a constantly increasing phenomenon across Europe—even in Italy where the prevalence of divorce has always been among the lowest. This poses several questions on the potential consequences of such an event on the families involved. Many studies show that women usually experience the worst financial consequences, although there are few analyses on Italy, given the relatively low levels of union instability. In this work we study the impact of separation on the economic well-being of men and women using data from the European Community Household Panel (ECHP), analyzed using both objective and subjective measures. By means of a matching method, we also estimate the effect of union dissolution, taking account of possible variations according to the different living arrangements adopted by ex-partners after separation. Results confirm that women experience worse economic distress than men. However, there is also a significant drop in economic well-being among non-custodial fathers who live alone after separation. In addition, it is found that income-based measures do not encapsulate all the dimensions of well-being, and therefore need to be complemented with other measures.