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A theory of exploitative child labor

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  • Carol Ann Rogers
  • Kenneth A. Swinnerton

Abstract

We develop a model in which some child labor is exploitative. Since exploited child laborers are paid less than the value of the marginal product of labor, there is scope for policy intervention to be Pareto improving. We illustrate this by showing that a system of inspection and fines targeted on exploitative child labor increases the aggregate output produced by children. We also establish that such intervention secures the release of children from exploitative working conditions, to their benefit. The distributional implications of the intervention among employers and among children who had not been exploited depends on whether capital is mobile internationally, and can depend on whether the elimination of exploitative child labor is partial or complete. Copyright 2008 , Oxford University Press.

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Bibliographic Info

Article provided by Oxford University Press in its journal Oxford Economic Papers.

Volume (Year): 60 (2008)
Issue (Month): 1 (January)
Pages: 20-41

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Handle: RePEc:oup:oxecpp:v:60:y:2008:i:1:p:20-41

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References

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  1. Arnab K. Basu & Nancy H. Chau, 2004. "Exploitation of Child Labor and the Dynamics of Debt Bondage," Journal of Economic Growth, Springer, vol. 9(2), pages 209-238, 06.
  2. Albrecht, James W & Axell, Bo, 1983. "An Equilibrium Model of Search Unemployment," Working Paper Series 99, Research Institute of Industrial Economics.
  3. Eric V. Edmonds & Nina Pavcnik, 2005. "Child Labor in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 199-220, Winter.
  4. Kenneth A. Swinnerton, 1997. "An Essay on Economic Efficiency and Core Labour Standards," The World Economy, Wiley Blackwell, vol. 20(1), pages 73-86, 01.
  5. 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.
  6. Dessy, Sylvain E. & Pallage, Stephane, 2001. "Child labor and coordination failures," Journal of Development Economics, Elsevier, vol. 65(2), pages 469-476, August.
  7. Carol Ann Rogers & Kenneth A. Swinnerton, 1999. "Inequality, Productivity, and Child Labor," Labor and Demography 9907003, EconWPA, revised 30 Jul 1999.
  8. Sylvain E. Dessy & Désiré Vencatachellum, 2003. "Explaining cross-country differences in policy response to child labour," Canadian Journal of Economics, Canadian Economics Association, vol. 36(1), pages 1-20, February.
  9. Jean-Marie Baland & James A. Robinson, 2000. "Is Child Labor Inefficient?," Journal of Political Economy, University of Chicago Press, vol. 108(4), pages 663-679, August.
  10. Basu, Kaushik, 1998. "Child labor : cause, consequence, and cure, with remarks on International Labor Standards," Policy Research Working Paper Series 2027, The World Bank.
  11. Sylvain E. Dessy & Stéphane Pallage, 2005. "A Theory of the Worst Forms of Child Labour," Economic Journal, Royal Economic Society, vol. 115(500), pages 68-87, 01.
  12. Sylvain Dessy & Stéphane Pallage, 2003. "The Economics of Child Trafficking," Cahiers de recherche 0323, CIRPEE.
  13. Natalia T. Tamirisa & R. B. Johnston, 1998. "Why Do Countries Use Capital Controls?," IMF Working Papers 98/181, International Monetary Fund.
  14. Arnab K. Basu & Nancy H. Chau, 2003. "Targeting Child Labor in Debt Bondage: Evidence, Theory, and Policy Implications," World Bank Economic Review, World Bank Group, vol. 17(2), pages 255-281, December.
  15. Ranjan, P., 1999. ""Credit Constraints and the Phenomenon of Child Labor"," Papers 98-99-12, California Irvine - School of Social Sciences.
  16. Swinnerton, Kenneth A, 1996. "Minimum Wages in an Equilibrium Search Model with Diminishing Returns to Labor in Production," Journal of Labor Economics, University of Chicago Press, vol. 14(2), pages 340-55, April.
  17. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-27, June.
  18. Genicot, Garance, 2002. "Bonded labor and serfdom: a paradox of voluntary choice," Journal of Development Economics, Elsevier, vol. 67(1), pages 101-127, February.
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Citations

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Cited by:
  1. Chau, Nancy, 2009. "Sweatshop Equilibrium," IZA Discussion Papers 4363, Institute for the Study of Labor (IZA).
  2. Irving Rosales, 2013. "Learn, sweat or steal: a theory of development and the activity of children," Working Papers 0613, Universidad Iberoamericana, Department of Economics.
  3. Davies, Ronald B., 2005. "Abstinence from child labor and profit seeking," Journal of Development Economics, Elsevier, vol. 76(1), pages 251-263, February.
  4. Sylvain E. Dessy & Flaubert Mbiekop & Stéphane Pallage, 2005. "The Economics of Child Trafficking (Part II)," Cahiers de recherche 0509, CIRPEE.
  5. Jorge Soares, 2009. "Welfare Impact of a Ban on Child Labor," Working Papers 08-01, University of Delaware, Department of Economics.
  6. Caroline Orset, 2008. "A Theory of Child Protection against Kidnapping," Cahiers de recherche 0816, CIRPEE.
  7. Sylvain Dessy & Caroline Orset & Legrand Yémélé Kana, 2012. "The Global Fight against Child Trafficking: How Can It Be Won ?," Cahiers de recherche 1213, CIRPEE.
  8. Eric V. Edmonds & Maheshwor Shrestha, 2013. "You Get What You Pay For: Schooling Incentives and Child Labor," NBER Working Papers 19279, National Bureau of Economic Research, Inc.
  9. Del Carpio, Ximena V. & Loayza, Norman V., 2012. "The impact of wealth on the amount and quality of child labor," Policy Research Working Paper Series 5959, The World Bank.
  10. Sylvain Dessy & Stéphane Pallage, 2003. "The Economics of Child Trafficking," Cahiers de recherche 0323, CIRPEE.
  11. Carol Ann Rogers & Kenneth A Swinnerton, 2005. "Slave Redemption When it Takes Time to Redeem Slaves," Development and Comp Systems 0510006, EconWPA.
  12. Bernd Beber & Christopher Blattman, 2010. "The Industrial Organization of Rebellion: The Logic of Forced Labor and Child Soldiering," HiCN Working Papers 72, Households in Conflict Network.

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