Dowry and Intrahousehold Bargaining: Evidence from China

Abstract

This paper analyzes the relationship between a woman’s intrahousehold bargaining position and her welfare within marriage using household data from rural China. Simultaneity problems are overcome by using dowry to proxy for bargaining position. Omitted variable bias is addressed by using grain shocks in the year preceding marriage as an instrument for dowry. Instrumented dowry positively impacts numerous measures of a wife’s welfare, including household purchases, the time allocation of household members, and the woman’s satisfaction with life, offering strong evidence in support of collective models of the household.