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As the underlying social and cultural dynamics are complex, legislative reform to boost women’s inheritance rights may potentially give a low-cost way to lessen gender discrimination and improve a variety of socioeconomic outcomes for women. State-level reform of inheritance laws in India has an interesting natural experiment for exploring whether also to what extent such efforts have already been effective. In 1994, the states of Karnataka and Maharashtra amended the Hindu Succession Act, granting daughters equal shares in inheritance in accordance with sons which were denied to daughters previously. The results of the reform could provide potentially important lessons for India, where similar, national-level changes were manufactured in 2005, and for countries where inheritance rights remain severely biased against women. The passing of sufficient time because the amendment was enacted, and the option of unique data over three generations, allow assessment of the impact of the legal change on women’s asset endowment and socioeconomic outcomes.
In a recently available paper (Deininger et al. 2010), we use data from the 2006 nationally representative Rural Economic and Demographic Survey, conducted by the National Council of Applied Economic Research, on 1,371 rural Hindu households in Karnataka and Maharashtra. The survey contains detailed information on the parents, siblings, and children of household heads, providing quantitative measures of intergenerational transfers of both physical and human capital investments.
The causal effect is isolated by exploiting the variation in the timing of father’s death to compare within household bequests of land directed at sons and daughters in both states. We find that as the amendment didn’t fully get rid of the underlying inequality, it increased women’s probability of inheriting land by 22 percentage points. Even where the actual inheritance isn’t yet observed, the actual fact that a woman can get to inherit property may increase her bargaining power or affect her marital prospects. Indeed, we look for a robust upsurge in women’s age at marriage (by 0.5 years) following the reform, and women achieved better outcomes in the marriage market, such as for example marrying at a later age, marrying a far more educated spouse, and having the capacity to make favourable reproductive decisions.