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Household Savings and Marriage Payments: Evidence from Dowry in India

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Listed:
  • Anukriti, S

    () (Boston College)

  • Kwon, Sungoh

    () (University of Connecticut)

  • Prakash, Nishith

    () (University of Connecticut)

Abstract

This paper examines how traditional marriage market institutions affect households' financial decisions. We study how bride-to-groom marriage payments, i.e., dowries, influence saving behavior in rural India. Exploiting variation in firstborn gender and heterogeneity in dowry amounts across marriage markets, we find that the prospect of paying higher dowry increases household savings, which are primarily financed through increased paternal labor supply. This is the first paper that highlights this alternative motive for savings in dowry-paying societies. However, we find no impacts of dowry expectations on son-preferring fertility behaviors and investments in girls.

Suggested Citation

  • Anukriti, S & Kwon, Sungoh & Prakash, Nishith, 2018. "Household Savings and Marriage Payments: Evidence from Dowry in India," IZA Discussion Papers 11464, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11464
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    Keywords

    household savings; dowry; marriage payments; India; labor supply; fertility; sex ratio; child investments;

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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