Why do gold prices fluctuate in India

More girls die when the price of gold is high

In Indian society, male offspring are generally considered more than daughters. An important factor in this is an old tradition that used to be widespread in Europe: the dowry for women when they get married. This has been prohibited by law in India since 1961 - but de facto continues to be the norm. For a dowry, however, families often have to save up the household income for several years. The costs for a daughter are therefore much higher than for a son. Conversely, the dowry is often an important source of income for families who marry off a son.

One of the study's authors, Sonia Bhalotra, believes that the international price of gold - gold jewelry is an important part of dowry - increases these costs for girls and leads parents to neglect or abort girls.

Violence against wives

The original purpose of the dowry was to protect the daughters who moved into the household of their husbands after the marriage, since previously only the women themselves had power of disposal over the dowry. As a rule, however, the husband or the in-laws have long had sole access to the dowry. In numerous cases, this leads to violence against married women - for example to extort an increase in the dowry from the bride's parents after the marriage.

Not affordable for many

Many families have to start saving for dowries when a daughter is born - even the comparatively good economic situation in India for years does not change that. The amount of the dowry adapts - in addition to factors such as region and caste membership - to the economic situation.

Not least because it is illegal, there are no systematic data on the development of the dowry. The study therefore examined the question of how much the dowry burdens families financially by looking at the international gold price over several decades - from 1972 to 2005. Gold jewelry is an important part of the dowry - and since around 90 percent of the gold is imported, the international gold price has a direct impact on the cost of the dowry.

Mortality fluctuates with the price of gold

The study compares the monthly average price for gold with the data of the birth statistics for the respective month. There is a clear statistical correlation: on the one hand, with the rapid rise in the price of gold triggered by the Soviet invasion of Afghanistan at the end of 1979. In the first few months of 1980, the number of newborn girl deaths rose by around nine percent. It remained unchanged for boys.

But smaller price shocks for gold also had an impact on the chances of survival of newborn girls: From 1972 to 1985 there was a clear correlation - if you compare a standard deviation in the gold price with the mortality rate in the same month - if the gold price rose by 6.3 percent, it took newborn girl mortality increased 6.4 percent in the same month. In the same period, however, according to Bhalotra, there was no noticeable change in mortality in newborn boys.

Another finding of the study: Girls who were born and survived when the price of gold was rising - were smaller than average in adulthood. This is in line with other studies that show that poor nutrition in childhood leads to slower growth and that some parents in India are less well-fed daughters than sons.

The study is based on regular surveys carried out on behalf of the government in households for which demographic and health data are collected (India Demographic and Health Surveys, DHS). The data includes more than 100,000 births.

Change with ultrasound

From the mid-1980s, ultrasound scans became more and more common in India - and with them the ability to determine the sex of a baby while pregnant. According to its own information, Bhalotra had already shown in an earlier study that this led to a change in strategy: instead of neglecting girls after giving birth, unwanted female fetuses have been aborted since then. The abortion of female fetuses has been advertised again and again by clinics - with the cost savings for the family.

Bhalotra, Selim Gulesci and Abhishek Chakravarty are convinced that parents in India often react to rising gold prices and minimize the prospect of “having to” raise a girl as much as possible. The gold price and the effects on the dowry are therefore an everyday topic - in private conversations as well as in the media. Other possible explanations of the correlation apart from the dowry were dismissed by the team as inconclusive.

The birth statistics suggest that female fetuses continue to be aborted. Between 2013 and 2015 there were only 900 girls for every 1,000 newborn boys. And this despite continuous growth and a gradual reduction in poverty. Incidentally, several earlier studies have shown that the “disappearance” of girls is primarily a phenomenon of higher social classes or castes.

Ownership as the root of evil

Bhalotra is convinced that even an effective monitoring of the dowry ban by the executive - this is hardly happening at the moment - would be of no use. This is so stuck in tradition that families would probably work together to circumvent the ban. Rather, Bhalotra focuses on better education for women and men - and equality for women in property rights. Both could lead to the dowry tradition, which is often dangerous for girls and women, slowly becoming less important.

The vast majority of marriages in India are mediated between families, love marriages are the great exception. According to the US online magazine Vox, violations of the ban on dowry are rarely reported - in ten million weddings in 2015 there were 10,000 ads. This only occurs in extreme cases: When the groom's family makes too high demands or the bride is mistreated or murdered. Such cases are reported more frequently as domestic violent crimes. In 2015, according to Vox, an average of almost 21 women were murdered every day by their grooms or in-laws because they were not satisfied with the dowry.

Cost is a key factor

Discrimination and violence against women continue to be a key social problem in the second most populous country on earth. One of the causes is considered to be the rules of inheritance, which men largely prefer. In addition, there are gender roles - traditionally religious and socially - which to this day often leave women little freedom. The current study now shows that economic considerations - i.e. the price of gold and the expected cost of the dowry - are an important factor in whether a girl will be born or survive.