Marital splits and income changes: Evidence from the British Household Panel Survey

We provide new evidence about what happens to people's incomes when their o r their parents' marital union dissolves using longitudinal data from waves 1-4 of the British Household Panel Survey. Marital splits are accompanied by substantial declines in real income for separating wives and children on ave rage, whereas separating husbands' real income on average changes much less. Results are shown to be robust to the choice of income definition an d degree of economies of scale built into the household equivalence scale, and are validated with information about respondents' assessments of how th eir personal financial circumstances changed. In addition we analyse the ex tent to which the welfare state mitigates the size of the income loss for w omen and children relative to men, and document the accompanying changes in social assistance benefit receipt and paid work, and maintenance income re ceipt and payment.