On the heterogeneity of dowry motives

Dowries have been modeled as pre-mortem bequests to daughters or as groom-prices paid to in-laws. These two classes of models yield mutually exclusive predictions, but empirical tests of these predictions have been mixed. We draw from historical evidence that suggests a bifurcated marriage market, in which some households use dowries as a bequest and others use dowries as a price. The competing theories of dowry allow us to structure an exogenous switching regression that places households in the price or bequest regime. The empirical strategy allows for multiple checks on the validity of regime assignment. Using retrospective marriage data from rural Bangladesh, we find evidence of heterogeneity in dowry motives; that bequest dowries have declined in prevalence and amount over time; and that bequest households are better off compared to price households on a variety of welfare measures.