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Decomposing Differences of Poverty Incidence between Single-Parent and Two-Parent Households: A Comparative analysis with the U.S.

Chiho Song 1 Yeo, Eugene 1

1한국보건사회연구원

Accredited

ABSTRACT

This article investigates the determinant factors of the disparity in poverty incidence between single- and two-parent households in Korea compared to those in the U.S. by using an Oaxaca-type decomposition method. To this end, the paper selects the single- and two-parent households by using data from the KOWEPS (Korea Welfare Panel Study) and the PSID (Panel Study of Income Dynamics). The results of decomposition analysis shows that 34.0% (66.0%) of overall differences in poverty incidence between single- and two-parent households in Korea can be explained by the characteristics coefficients) effect. Likewise, in U.S., effects in coefficients (68.0%) explain the gap in poverty incidence more than effects in characteristics (32.0%). When both characteristics and coefficients effects are combined in two countries, all factors contribute to widening the differences in poverty incidence, except for childcare burden. Especially, holding others constant, three independent variables containing labor force participation status, educational attainment and childcare burden explains much of the poverty incidence gap than any other factors in Korea and U.S. This implies that enhancing productivity of single-parent households by stimulating the labor market participation can have the hugest impact on reducing the poverty gap; therefore, in order to effectively decrease the poverty gap between single- and two-parent households, it is desirable that the top priority should be put on the activation policy, for instance, giving support to better access to employment, education and training in single-parent households.

Citation status

* References for papers published after 2023 are currently being built.