The Complexity of Marriage in Rural Ethiopia: Parental Transfers and Post-marital Residence Choices

This paper examines the relationship between parental transfers and post-marital residence of children in rural Ethiopia. We investigate whether asset transfers to children are an avenue which parents use to secure old age. We model post-marital residence and transfers simultaneously in a two-stage probit least squares estimation framework. We find a positive relationship between transfers and post-marital residence, a proxy for old age support. Children who receive more assets are more likely to stay at birth place after marriage and vice versa. In conditions of scarce or lacking social security mechanisms, parents make strategic transfers to ensure better old age.