Household Formation and Marriage Markets in Rural Areas

This chapter surveys the voluminous literature on household formation and marriage markets in developing countries. We begin by discussing the many social and economic factors that incite individuals to live together in households. Many of these factors are particularly important in poor countries, especially in a rural setting. We then focus on marriage, which is the process by which the main building block of most households is formed. After discussing assortative matching and polygyny, we introduce bargaining and strategic bequest and discuss their implication for the equilibrium of the marriage market. We end the chapter with a discussion of marriage dissolution and other changes in household structure. Fertility decisions are not discussed here as they have already been covered elsewhere.