Timothée Demont: timothee.demont[at]univ-amu.fr
Alice Fabre: alice.fabre[at]univ-amu.fr
When markets are incomplete, cultural norms may play an important role in shaping economic behavior. In this paper, we explore whether child marriages increase with income shocks in societies that engage in bride price payments -- transfers from the groom to the bride's parents at marriage. We develop a simple model in which households are exposed to income volatility and have no access to credit markets. If a daughter marries, the household obtains a bride price. In this framework, girls have a higher probability of marrying early when their parents have higher marginal utility of consumption because of adverse income shocks, given that bride price decreases with the daughter' age. We test the prediction of the model by exploiting variation in rainfall shocks over a woman's life cycle, using a survey dataset from rural Tanzania. We find that adverse shocks during teenage years increase the probability of early marriages and early fertility among women. The relationship is stronger in villages where bride price payments are typically higher. We use these empirical results to estimate the parameters of our model and isolate the role of the bride price custom for consumption smoothing. In counterfactual exercises, we show that parents heavily rely on child marriages and bride price payments to smooth consumption. Without credit markets, bans on these practices are costly for a daughter's parents. However, ensuring access to credit limits parents' cost, making bans more likely to succeed.