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A note on multiple general equilibria with child labor

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  • Basu, Kaushik

Abstract

It has been conjectured, using partial equilibrium analysis, that the market for child labour is likely to exhibit multiple equilibria, with children working in some but not in others. Such a result has important policy implications, especially concerning the use of a legislative ban on child labour. This paper shows that the multiple equilibrium result holds in a formal general equilibrium model. The paper develops the concept of a 'wage bill curve' and shows how this is a useful tool for studying the relation between household preference and multiple equilibria. It also clarifies the kind of welfare criteria needed to justify a legislative ban on child labour.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 74 (2002)
Issue (Month): 3 (February)
Pages: 301-308

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Handle: RePEc:eee:ecolet:v:74:y:2002:i:3:p:301-308

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References

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  1. Ranjan, P., 1999. ""Credit Constraints and the Phenomenon of Child Labor"," Papers 98-99-12, California Irvine - School of Social Sciences.
  2. Carol Ann Rogers & Kenneth A. Swinnerton, 1999. "The Economics of Child Labor: Comment," American Economic Review, American Economic Association, vol. 89(5), pages 1382-1385, December.
  3. Kaushik Basu, 1999. "Child Labor: Cause, Consequence, and Cure, with Remarks on International Labor Standards," Journal of Economic Literature, American Economic Association, vol. 37(3), pages 1083-1119, September.
  4. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-27, June.
  5. Ray, Ranjan, 2000. "Child Labor, Child Schooling, and Their Interaction with Adult Labor: Empirical Evidence for Peru and Pakistan," World Bank Economic Review, World Bank Group, vol. 14(2), pages 347-67, May.
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Cited by:
  1. Jean-Pierre Lachaud, 2004. "Le travail des enfants et la pauvreté en Afrique : un réexamen appliqué au Burkina Faso," Documents de travail 96, Groupe d'Economie du Développement de l'Université Montesquieu Bordeaux IV.
  2. Rubiana Chamarbagwala & Rusty Tchernis, 2010. "Exploring the spatial determinants of children’s activities: evidence from India," Empirical Economics, Springer, vol. 39(2), pages 593-617, October.
  3. Emerson, Patrick M. & Portela Souza, André, 2007. "Is Child Labor Harmful? The Impact of Working Earlier in Life on Adult Earnings," IZA Discussion Papers 3027, Institute for the Study of Labor (IZA).
  4. Drusilla K. Brown & Alan V. Deardorff & Robert M Stern, 2002. "The Effects of Multinational Production on Wages and Working Conditions in Developing Countries," Working Papers 486, Research Seminar in International Economics, University of Michigan.
  5. Edmonds, Eric V., 2007. "Child Labor," IZA Discussion Papers 2606, Institute for the Study of Labor (IZA).
  6. Rubiana Chamarbagwala & Rusty Tchernis, 2006. "The Role of Social Norms in Child Labor and Schooling in India," Caepr Working Papers 2006-016, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington.
  7. Chakrabarty, Sayan & Grote, Ulrike, 2009. "Child Labor in Carpet Weaving: Impact of Social Labeling in India and Nepal," World Development, Elsevier, vol. 37(10), pages 1683-1693, October.
  8. Rubiana Chamarbagwala, 2004. "Returns to Education, Child Labor, & Schooling in India," Development and Comp Systems 0410003, EconWPA.
  9. Sarbajit Chaudhuri & Manash Ranjan Gupta, 2005. "Child Labour And Trade Liberalization In A Developing Economy," Labor and Demography 0510017, EconWPA.
  10. Neumayer, Eric & de Soysa, Indra, 2005. "Trade Openness, Foreign Direct Investment and Child Labor," World Development, Elsevier, vol. 33(1), pages 43-63, January.
  11. Mita Bhattacharya, 2007. "Globalisation And Child Labour: Evidence From India," Development Research Unit Working Paper Series 09-07, Monash University, Department of Economics.
  12. Koolwal, Gayatri & Ray, Ranjan, 2002. "Estimating the endogenously determined intrahousehold balance of power and its impact on expenditure pattern : evidence from Nepal," Policy Research Working Paper Series 2814, The World Bank.

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