Divorce Norms , Intrahousehold Bargaining , and Household Outcomes in Rural Ethiopia

This work augments existing household bargaining literature by focusing on locally varied property rights norms in determining spouses’ relative threat points. While similar studies have used spouses' pre-marriage assets as an indicator of bargaining power, I hypothesize that the division of property in case of divorce might provide a more relevant indicator, given the legal predominance of varying customary laws across rural Ethiopia. I test this hypothesis using 1997 household survey data and a standard household bargaining model and find that there is a strong positive link between wives' rights to housing and child custody and household budget shares for food, while the links with budget shares for cigarettes and alcohol and medical care are significantly negative. Moreover, increased housing rights for women strongly improve their daughters’ educational outcomes, apparently at the expense of their sons’ schooling, while stronger child custody rights do the opposite.