Marriage Market Transfers of Resources and Property Rights

We analyze the nature of marriage market transfers (dowry) by developing a simple competitive model of the marriage market in which bridal families decide how much to transfer to their daughter and how much to transfer to a potential groom. By allocating property rights over total marital transfers in this way, the bridal family influences the outcome of household bargaining. This approach connects two seemingly unrelated roles for dowries identified in the literature; as a pre-mortem inheritance for daughters (“bequest”) and as a price for grooms in the marriage market (“groomprice”). The analysis helps explain the historical record of dowries, whereby the prominent role of dowries transforms from bequest to groomprice during early modernization. The model produces some further results of interest: we show that positive assortative matching is not a robust prediction in this setting, and that equilibrium transfers are generally not Pareto efficient when transfers to the bride are in the form of premarital investment in human capital.