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Do households resort to child labor to cope with income shocks?

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Author Info
Kathleen Beegle () (World Bank - Development Research Group (DECRG))
Rajeev H. Dehejia () (National Bureau of Economic Research (NBER))
Roberta Gatti () (World Bank - Development Research Group (DECRG))

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Abstract

Using four rounds of panel household data from the Kagera region of Tanzania, we show that transitory income shocks ¨C measured by the value of crop lost by farming households ¨C lead to significantly increased child labor. A one standard deviation increase in the shock is associated with a 10% increase in mean child working hours. Moreover, we find that households with collateralizable assets ¨C which we interpret as a proxy for access to credit ¨C are better able to offset the effects of income shocks. This evidence supports the view that credit market imperfections are an important determinant of child labor.

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Paper provided by Columbia University, Department of Economics in its series Discussion Papers with number 0203-12.

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Length: 27 pages
Date of creation: 2002
Date of revision:
Handle: RePEc:clu:wpaper:0203-12

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Rajeev Dehejia & Roberta Gatti, 2002. "Child Labor: The Role of Income Variability and Access to Credit Across Countries," NBER Working Papers 9018, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  2. Alan Krueger, 1996. "Observations on International Labor Standards and Trade," Working Papers 741, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
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  3. Gupta, Manash Ranjan, 2000. "Wage Determination of a Child Worker: A Theoretical Analysis," Review of Development Economics, Blackwell Publishing, vol. 4(2), pages 219-28, June. [Downloadable!] (restricted)
  4. Ranjan, Priya, 2001. "Credit constraints and the phenomenon of child labor," Journal of Development Economics, Elsevier, vol. 64(1), pages 81-102, February. [Downloadable!] (restricted)
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  5. repec:fth:prinin:362 is not listed on IDEAS
  6. 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. [Downloadable!] (restricted)
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  7. Parsons, Donald O & Goldin, Claudia, 1989. "Parental Altruism and Self-Interest: Child Labor among Late Nineteenth-Century American Families," Economic Inquiry, Oxford University Press, vol. 27(4), pages 637-59, October.
  8. Bourguignon, F. & Browning, M. & Chiappori, P. A., 1995. "The Collective Approach to Household Behaviour," DELTA Working Papers 95-04, DELTA (Ecole normale supérieure).
  9. Sonia Bhalotra & Christopher Heady, 2003. "Child Farm Labor: The Wealth Paradox," World Bank Economic Review, Oxford University Press, vol. 17(2), pages 197-227, December.
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  10. 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. [Downloadable!] (restricted)
  11. Becker, Gary S & Murphy, Kevin M, 1988. "The Family and the State," Journal of Law & Economics, University of Chicago Press, vol. 31(1), pages 1-18, April.
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  12. Ravallion, Martin & Wodon, Quentin, 1999. "Does child labor displace schooling? - evidence on behavioral responses to an enrollment subsidy," Policy Research Working Paper Series 2116, The World Bank. [Downloadable!]
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  13. Jacoby, Hanan G & Skoufias, Emmanuel, 1997. "Risk, Financial Markets, and Human Capital in a Developing Country," Review of Economic Studies, Blackwell Publishing, vol. 64(3), pages 311-35, July. [Downloadable!] (restricted)
  14. Townsend, Robert M, 1994. "Risk and Insurance in Village India," Econometrica, Econometric Society, vol. 62(3), pages 539-91, May. [Downloadable!] (restricted)
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  15. Al-Samarrai, Samer & Peasgood, Tessa, 1998. "Educational attainments and household characteristics in Tanzania," Economics of Education Review, Elsevier, vol. 17(4), pages 395-417, October. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Elizabeth M. Caucutt & Krishna B. Kumar, 2003. "Education Policies to Revive a Stagnant Economy: The Case of Sub- Saharan Africa," Development and Comp Systems 0304002, EconWPA. [Downloadable!]
  2. Elizabeth M. Caucutt & Krishna B. Kumar, 2004. "Evaluating Explanations for Stagnation," Development and Comp Systems 0409002, EconWPA. [Downloadable!]
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  3. Christopher Udry, 2003. "Child Labor," Working Papers 856, Economic Growth Center, Yale University. [Downloadable!]
    Other versions:
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