We study reputation dynamics within the household in a setting where women regularly receive transfers from their husbands for household purchases. We propose a signaling model in which wives try to maintain a good reputation in the eyes of their husbands to receive high transfers. This leads them to (i) avoid risky purchases (goods with unknown returns) and (ii) knowingly overuse low-return goods to hide bad purchase decisions—we call this the intrahousehold sunk cost effect. We present supportive evidence for the model from a series of experiments with married couples in rural Malawi.

Maternal mortality remains very high in many parts of the developing world, especially in sub-Saharan Africa. While maternal deaths are observable, it may not be straightforward for individuals to learn about risk factors. This paper utilizes novel data on male and female perceptions of maternal risk in Zambia to document that superstitions about causes of maternal mortality are pervasive and to uncover evidence that such beliefs impede learning about maternal health risk levels and correlates. In our data, people who hold traditional beliefs disregard past birth complications completely in assessing future risk, unlike those who hold modern beliefs.