Avoiding material hardship
The buffer function of wealth
Bibliographic Data
| ID | 12255482 |
|---|---|
| Authors | Richard Rodems (0000-0001-9426-7109, Case Western Reserve University, Cleveland, OH, USA, corresponding author), F T Pfeffer (0000-0002-6196-0617, University of Michigan, Ann Arbor, MI, USA) |
| Year | 2021 |
| Volume | 31 |
| Issue | 5 |
| Pages | 517-532 |
| Publication date | 2021-12-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Journal of European Social Policy (JOURNAL) |
| Journal identifiers | ISSN: 0958-9287 • E-ISSN: 1461-7269 |
| Publisher | SAGE Publishing (PUBLISHER • US) |
| DOI | 10.1177/09589287211059043 |
| OpenAlex | W4200615162 |
| Language | EN |
| Citations received | 31 |
| References cited | 42 |
We assess how a variety of disruptive life-course events impact the economic wellbeing of US households and trace the importance of household wealth in helping families who experience these events avoid entering a spell of material hardship. Using longitudinal data from two panels of the Survey of Income and Program Participation (SIPP), we draw on direct measures of material hardship, disruptive events and household assets. Our analyses reveal that the relationship between disruptive events and the likelihood of experiencing a new spell of material hardship strongly varies across the wealth distribution, suggesting that high household wealth provides an effective private safety net. By distinguishing different types of disruptive events, we demonstrate that divorce, disability and income loss entail a risk of material hardship but also that this risk is effectively buffered by substantial wealth. Different types of hardship – namely, financial, food and medical hardship – respond in similar ways. Like public insurance schemes, wealth insurance helps buffer the effects of disruptive events on material hardship, but unlike public insurance schemes, reliance on private wealth further stratifies the economic wellbeing of households. Policy options for addressing this highly stratified private insurance scheme include disposing of the need for it by funding more robust public insurance, for instance through wealth taxation
Actuarial science · Business · Debt · Demographic economics · Economics · Net worth · Public economics · Safety net · Spell · Survey of Income and Program Participation · Financial Literacy, Pension, Retirement Analysis · Housing, Finance, and Neoliberalism · Income, Poverty, and Inequality · Finance
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The Negotiation of Intergenerational Support for Housing
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Has China's “only-out, no-in” staff-reduction policy alleviated the material deprivation of forestry worker families? Evidence from China's Natural Forest Protection Program
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Racial/ethnic wealth gaps and material hardship disparities among U.S. households with young children
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The educational wealth divide in Europe
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Insured Privately? Wealth Stratification of Job Loss in the UK
The Buffer Function of Wealth in Socioemotional Responses to Covid‐19 in Italy
Wealth Stratification and the Insurance Function of Wealth
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Is Property an Insurance or an Additional Burden? Financial Stress Among Homeowners in Europe
Is household wealth important for child behavior under persistent food insecurity? An application of longitudinal latent class analysis and generalized propensity score weight
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Poverty and Deprivation in Europe
Poverty and the Distribution of Material Hardship
Slipping into and out of Poverty
Consumption Inequality and Partial Insurance
Poverty and material deprivation among E uropean workers in times of crisis
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Improving the measurement of material deprivation at the European Union level
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Rethinking the Risks of Poverty
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Direct and Indirect Measures of Poverty
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Estimation of Joint Income-Wealth Poverty
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| Unique citing works | 31 |
|---|---|
| Citations per year | 6,2 |
| Citation span | 2021 - 2026 (6) |
| Citation velocity | current |
| Highly cited | No |
| Citation types | Neutral: 31 |