Of economists and dowry

It is getting to be very scary. Prowling economists -- doubtless encouraged by Steven D Levitt -- are analysing anything they can lay their hands on. And they are telling us what we already know.

The latest extravagance is a paper* by Raj Arunachalam and Trevon D Logan on dowry in rural Bangladesh. Before we know it, some economist will be peering into data about this column and asking: when can we expect this guy to go off the deep end?

As befits any self-respecting economist, the authors have defined dowry as a pre-mortem (what a lovely word) bequest, that is, a handout before the dad pops off. They say you can look at it in two ways: either as bequests to daughters -- what we call streedhan -- or as a bribe to the groom to take a liability off your hands for life. (If the groom is a useless non-economist, or even worse, a journalist, the bribe amount drops sharply).

The authors say "the heterogeneity of findings can be explained by a heterogeneous world -- some households use dowries as a bequest and others use dowries as a price." Well, well, what do you know?

Then, they "estimate a model with heterogeneous dowry motives and use the predictions from the competing theories in an exogenous switching regression to place households in the price or bequest regime." What can one say?

So what do they find? "We find robust evidence of heterogeneity in dowry motives in the population and 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."

That is they treat these two categories of pre-mortem bequests as being mutually exclusive. In reality, of course, we know that the pre-mortem bequest comprises both.

The authors say that in more than a quarter of the samples they have, people said dowry was a bequest, not a price. But how many people actually admit to it being a price? Anyhow, they get what they call a "bifurcated marriage market."

There is also a discussion of something called "marriage squeeze," which apparently has been debated by economists. What happens, or is said to happen, is that bride price goes up because of "changes in bride and groom characteristics". That is, a groom with a Ph D in economics can, if he so desires, ask for a much higher price than a fellow who has not passed middle school.

The authors also say that it is rare to find dowry being paid in cash alone because these are rarely under the control of brides. More often than not, there is a non-cash transfer also (though if you demand and get a hamara Bajaj, I wonder under whose control it actually is).

Finally, the authors get to the point. It seems ( and I must say I didn't know this) some people have been defending dowry on the grounds that it is mainly streedhan rather than a bribe or compensation to the grooms family for taking over a liability.

"Rather than enter this debate, we offer evidence indicating a broad shift in the dowry motive that derives directly from the bequest theory." Does that mean they approve of dowry? Not at all.

"While we have not attempted to generate policy implications, our results, taken together, stand against the principal claims of opponents to dowry bans.As women's access to inheritances improves due to stronger property rights, we should expect a decline in the prevalence and size of bequest dowries." Ahem! Really? Great. In rural Bangladesh at least, it seems, "bequest dowries have decreased in amount over time."

I would suggest that everyone who reads this column should read the full paper, if only to become acquainted with the results of mixing economics with sociology. It can be as intoxicating as whiskey.

*On the Heterogeneity of Dowry Motives, NBER Working Paper No. 12630 October 2006, https://www.nber.org/papers/w12630