Wealth Distribution within Couples and Financial Decision Making

Markus Grabka, Jan Marcus and Eva Sierminska

No 540, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)

Abstract: While most studies on wealth inequality focus on the inequality between households, this paper examines the distribution of wealth within couples. For this purpose, we make use of unique individual level micro data from the German Socio-Economic Panel (SOEP). In married and cohabiting couples, men have, on average, 33,000 Euro more net worth than women. We look at five different sets of factors (demographics, income, labor market, inheritances, financial decision making in the partnership) that might explain this wealth gap. We find that all factors contribute to the explanation of the wealth gap within partnerships, with inheritances and income being particularly relevant. Furthermore, we find that specific characteristics (e.g. self-employment, no migration background, inheritances, high income) that decrease the wealth gap for women increase it for men. For men the respective coefficients are even stronger in absolute terms. When examining intra-partnership financial decision making, we find the gap to be significantly smaller when the female manages the money and larger if the male partner has the last word in financial decisions.

Keywords: Wealth gap; Wealth inequality; Intra-household allocation; Gender; Financial decision making; SOEP (search for similar items in EconPapers)
JEL-codes: D13 D31 D69 I31 J2 (search for similar items in EconPapers)
Pages: 26 p.
Date: 2013
New Economics Papers: this item is included in nep-dem and nep-eur
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Working Paper: Wealth distribution within couples and financial decision making (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwsop:diw_sp540

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