Barriers to Capital Accumulation and the Incidence of Child Labor
AbstractThe World Bank documents an inverse relationship between GDP per-capita and child labor participation rates. We construct a life-cycle model with human and physical capital in which parents make a time allocation choice for their child. The model considers two features that have shown potential in explaining differences in states of development across nations. These are: i) a minimum consumption requirement, and ii) barriers to physical capital accumulation. We find the introduction of capital barriers alone is not enough to replicate the aforementioned observation by the World Bank. However, we find the interplay of a minimum consumption requirement and barriers to capital may enhance our understanding of child labor, human capital, and the poverty of nations. Additionally, we find support for policies aimed at reducing capital barriers as means to reduce child labor over an out and out ban on it.
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Bibliographic InfoPaper provided by DEGIT, Dynamics, Economic Growth, and International Trade in its series DEGIT Conference Papers with number c016_014.
Length: 24 pages JEL Classification:
Date of creation: Sep 2011
Date of revision:
Other versions of this item:
- Marco A Espinosa-Vega & Richard C. Barnett, 2005. "Barriers to Capital Accumulation and the Incidence of Child Labor," IMF Working Papers 05/220, International Monetary Fund.
- NEP-ALL-2012-05-15 (All new papers)
- NEP-DEM-2012-05-15 (Demographic Economics)
- NEP-DEV-2012-05-15 (Development)
- NEP-DGE-2012-05-15 (Dynamic General Equilibrium)
- NEP-LAB-2012-05-15 (Labour Economics)
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