Economic consequences of union dissolution in Italy: findings 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 consequences which such an event can have on the families involved. Many studies show that women usually undergo the worst financial consequences, although there are few analysis on Italy, given the relatively low diffusion 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), analysed using both objective and subjective measures. By means of a matching method, the effect of union dissolution is also estimated considering possible interactions with living arrangements which ex-partners take after separation. Results confirm that women undergo worse economic distress than men. However, there is also a significant drop in their economic well-being also among non-custodial fathers who live alone after separation. In addition, this work suggests that monetary measures of economic well-being should be used with caution.