Living arrangements, intra-household inequality and children's deprivation:evidence from EU-SILC

Evidence from the 2014 EU-SILC indicates that a non-negligible proportion of children in Europe live in multi-family households. Leaving aside more complex household types, around 4% of children live with their grandparents and a further 7% with their adult siblings. In this paper we investigate the extent to which living in these two types of households protects children against material deprivation and we provide direct tests of the relationship between the distribution of bargaining power within households and children’s deprivation outcomes. Our findings indicate that most groups of children in multi-family households face significantly higher deprivation than children in nuclear households. The exception is lone-parent children who live in multi-family households with their grandparents, who in many countries face a lower deprivation risk than their counterparts in nuclear households. To a large extent the higher deprivation risk of most children in multi-family households reflects selection into co-residence of families facing financial difficulties. Household income and household work intensity explains to a large extent the higher deprivation risk of children in multi-family households. By contrast neither mother’s nor parents’ income share within the household are significant predictors of children’s deprivation status, once other factors are controlled for, suggesting that the distribution of bargaining power within the household does not have any effect on children’s deprivation outcomes. Using a simulation exercise we further show that co-residence with grandparents protects a large share of children against deprivation while co-residence with adult siblings has more mixed effects across countries. Analysis of the within household differences in deprivation outcomes shows that differences in deprivation status between children and adults in multifamily households are common, with parents and grandparents apparently more likely to make sacrifices in their own living standards to protect both dependent and adult children in the household from deprivation.