Wife or Frau, Women Still Do Worse: A Comparison of Men and Women in the United States and Germany after Union Dissolutions in the 1990s and 2000s

Abstract

Using harmonized PSID and SOEP panel data from the CNEF we track changes in economic wellbeing before and after union separations in the U.S. and Germany since 1993 for both men and women for both the short- and the long-term. We find, based on our measures of pre- and post-government equivalent income, that women in both Germany and the U.S. experience much larger declines in their economic wellbeing than men following divorce. Yet the magnitude of these losses is remarkably similar in the short-term. Government taxes and transfers reduce the size of these losses in both countries as well as the gap between the outcomes of men and women following divorce especially in Germany. We are also able to show that in the long-term, the economic wellbeing of these divorced men and women improves in both countries but disproportionately so for women. Despite these gains, we still find that in both the short- and long-term whether “wife or frau”, women who divorced in the 1990s and 2000s still do worse than their partners. JEL Classification: J12, J11 Key words: Divorce, Germany, U.S., wellbeing, PSID, SOEP