These were very common when I was a kid, used just like this, as a vacation baggage hauler. They attached to the rear bumper at two places, and the single wheel was free to rotate as needed when going around a corner, like the casters on a grocery cart. The huge advantage was no fishtailing or jackknifing and backing up became a non-issue. The single wheel just swung around and followed however the car/trailer combo. Most of the ones I remember were a bit smaller than this one.
Haven’t seen one in years. You?
Update: they do still make and sell them.
They even make larger ones for trucks and RVs with dual swiveling wheels. They attach to a hitch receiver. No sway, fishtailing or jackknifing. They can even be mounted on the back of those big fifth wheel trailer.
Here’s a video of a VW with one.