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Free Education Policy and Trade Liberalization: Consequences on Child and Adult Labour Markets in a Small Open Economy

Author

Listed:
  • Chaudhuri, Sarbajit

    (University of Calcutta)

  • Mukhopadhyay, Ujjaini

    (University of Calcutta)

Abstract

The paper purports to examine the implications of a free education policy and trade liberalization on the child and adult labour markets in the set-up of a Harris-Todaro type general equilibrium model. It has been found that a hike in the education subsidy or an inflow of foreign capital may produce counterproductive results on the supply of child labour in the urban area. Moreover, these policies may raise the level of urban unemployment of adult labour even when two types of labour are not substitutes to each other. The average income of the urban poor families may also decrease as a consequence.

Suggested Citation

  • Chaudhuri, Sarbajit & Mukhopadhyay, Ujjaini, 2003. "Free Education Policy and Trade Liberalization: Consequences on Child and Adult Labour Markets in a Small Open Economy," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 18, pages 336-359.
    • Handle: RePEc:ris:integr:0237
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    References listed on IDEAS

    as
    1. Jimenez, E. & Lockheed, M.E., 1995. "Public and Private Secondary Education in Developing Countries. A Comparative Study," World Bank - Discussion Papers 309, World Bank.
    2. Osmani, S. R., 1990. "Wage determination in rural labour markets : The theory of implicit co-operation," Journal of Development Economics, Elsevier, vol. 34(1-2), pages 3-23, November.
    3. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-427, June.
    4. 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.
    5. Kingdon, Geeta Gandhi & Knight, John, 2004. "Unemployment in South Africa: The Nature of the Beast," World Development, Elsevier, vol. 32(3), pages 391-408, March.
    6. Sarbajit Chaudhuri, 2000. "Rural–Urban Migration, the Informal Sector, Urban Unemployment, and Development Policies: A Theoretical Analysis," Review of Development Economics, Wiley Blackwell, vol. 4(3), pages 353-364, October.
    7. Dessy, Sylvain E., 2000. "A defense of compulsive measures against child labor," Journal of Development Economics, Elsevier, vol. 62(1), pages 261-275, June.
    8. Ravallion, Martin & Wodon, Quentin, 2000. "Does Child Labour Displace Schooling? Evidence on Behavioural Responses to an Enrollment Subsidy," Economic Journal, Royal Economic Society, vol. 110(462), pages 158-175, March.
    9. Chandra, Vandana & Khan, M Ali, 1993. "Foreign Investment in the Presence of an Informal Sector," Economica, London School of Economics and Political Science, vol. 60(237), pages 79-103, February.
    10. Kingdon, Geeta Gandhi & Knight, John, 2004. "Unemployment in South Africa: The Nature of the Beast," World Development, Elsevier, vol. 32(3), pages 391-408, March.
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    Cited by:

    1. Sarbajit Chaudhuri & Jayanta Kumar Dwibedi, 2006. "Trade Liberalization in Agriculture in Developed Nations and Incidence of Child Labour in a Developing Economy," Bulletin of Economic Research, Wiley Blackwell, vol. 58(2), pages 129-150, April.
    2. Khan, M. Ali Khan, 2007. "The Harris-Todaro Hypothesis," MPRA Paper 2201, University Library of Munich, Germany.
    3. Chakraborty, Kamalika & Chakraborty, Bidisha, 2018. "Endogenous Altruism, Learning by Doing Effect and Impact of Domestic Policies on Child Labour," MPRA Paper 89229, University Library of Munich, Germany.
    4. Titas Kumar Bandopadhyay, 2007. "Trade Reform, Capital Mobility, and Efficiency Wage in a Harris-Todaro Economy," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 46(2), pages 163-174.
    5. Chakraborty, Kamalika & Chakraborty, Bidisha, 2016. "Learning by doing, low level equilibrium trap, and effect of domestic policies on child labour," MPRA Paper 74712, University Library of Munich, Germany.
    6. Chakraborty, Kamalika & Chakraborty, Bidisha, 2016. "Child labour ban versus Education subsidy in a model with learning by doing effect in unskilled work," MPRA Paper 74203, University Library of Munich, Germany.
    7. Rakhi Banerjee & Ranjanendra Narayan Nag, 2013. "Globalization, Child Labour and Development Policies: A Theoretical Analysis," Foreign Trade Review, , vol. 48(1), pages 83-104, February.

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    More about this item

    Keywords

    hild labour; Urban unemployment of adult labour; General equilibrium; Education subsidy; Trade liberalization.;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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