# 1 Introduction

Consanguineous marriage, or marriage between close biological relatives, is a social institution that is, or has been, common throughout human history (Bittles, 1994, Bittles et al., 1993, and Hussain and Bittles, 2000). Although in the western world consanguineous marriages constitute less than 1 percent of total marriages, this practice has enjoyed widespread popularity in North Africa, the Middle East and South Asia (Maian and Mushtaq, 1994; Bittles 2001).<sup>1</sup> In Iraq for example, 46.4 percent of marriages are between fi rst or second cousins (Al-Hamamy et al, 1986; Al-Hamamy and Al-Hakkak, 1989; also reported in the New York Times, September 23, 2003). In India, data from the 1992-93 National Family Health Survey show that consanguineous marriages constitute 16 percent of all marriages, but this varies from 6 percent in the north to 36 percent in the south (IIPS and ORC Macro International, 1995, Banerjee and Roy, 2002). More widely, evidence from South Asia suggests that consanguineous marriage occurs in rural areas (Rao and Inbaraj, 1977, and Reddy, 1993), irrespective of religious groups and economic classes (Bittles 2001, and Iyer, 2002). Scienti fi c research in clinical genetics documents a negative effect of inbreeding on the health and mortality of human populations, and the incidence of disorders and disease among the offspring of consanguineous unions (Bittles, 2001). But a key gap in all these studies is that the economic dimensions of the prevalence of consanguineous marriage are comparatively unexplored.

It is in this setting that this paper makes its contribution: to postulate that consanguinity is a response to a marriage market failure in developing countries, rather than simply a consequence of culture, religion or preferences. The starting point of our analysis are the following two stylized facts commonly observed in large parts of South Asia and elsewhere. On the one hand, marriage celebrations are often associated with monetary transfers between families. If such transactions take place early on rather than at later stages in marital life, it suggests that they might be a response to time-inconsistent behavior on the part of one of the individuals or families involved in the marriage contract. On the other hand, as brie fl y discussed previously, consanguineous marriages can be a very widespread practice in some communities. This prompts us to wonder what the bene fi ts of marrying close kin are. The presumption that informal enforcement mechanisms are more likely to be available to relatives induces us to think that consanguinity mitigates the costs associated with incomplete contracts.

This paper is an attempt to elucidate these two issues in both theoretical and empirical contexts. We reconcile the existence of dowries and the prevalence of consanguinity in marriages within a single theoretical framework. When the marriage market is characterized by positive assortative mating, each party wants to commit ex-ante to largely contribute to household production as this will result in an increase in the value of the match. However, once links have formed and are costly to sever, one family holds the other up, and may now prefer to invest in alternative opportunities, while free-riding on in-laws’ investments. To overcome this time-inconsistency, ex-ante transfers

> <u>1</u> Although this practice enjoyed widespread popularity in Europe, the genetic implications of this practice was often derided in other continents: for example, on 5 March 1810 in a letter to the Governor of New Hampshire John Langdon, Thomas Jefferson wrote, ‘The practice of Kings marrying only in the families of Kings, has been that of Europe for some centuries. Now, take any race of animals, con fi ne them in idleness and inaction, whether in a stye, a stable or a state-room, pamper them with high diet, gratify all their sexual appetites, immerse them in sensualities, nourish their passions, let everything bend before them, and banish whatever might lead them to think, and in a few generations they become all body and no mind; and this, too, by a law of nature, by that very law by which we are in the constant practice of changing the characters and propensities of the animals we raise for our own purposes. Such is the regimen in raising Kings, and in this way they have gone on for centuries.’ (Bergh, 1907). For further information on consanguinity in earlier European generations, see Bittles and Egerbladh (2005).

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