Do different household models affect poverty? A dynamic panel analysis in 28 European countries

Maria Alessandra Antonelli, Angelo Castaldo, Valeria De Bonis and Andrea Salustri

Applied Economics, 2025, vol. 57, issue 32, 4664-4678

Abstract: The increase in the number of single-parent households and divorces, the decrease in marriages and the increasing relevance of household models with more than two cohabiting adults represent a recent social trend that emerges in modern societies. In this paper, we investigate how the evolution in the incidence of different household models affects household poverty in Europe. Using a panel of 28 European countries over a 14-year period (2005 to 2018), we implement both panel fixed- and random-effects models and the system-GMM dynamic panel method by estimating short- and long-run coefficients. Our analysis points out that household’s dissolution and the share of single-parent households with children are positively correlated with the risk of poverty; extended households play a role in insuring against poverty. Moreover, we find that households’ poverty is persistent over time with a speed of adjustment equal to 0.5 and a median time lag of one year. Our results also suggest that family policies represent an effective tool against the effects of social exclusion, becoming more evident in the long run.

Date: 2025
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DOI: 10.1080/00036846.2024.2364086

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