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Rotten Parents and Child Labor

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Abstract

We show that taking into account the consequences of child labor on both childhood welfare and human capital investment, instead of focusing exclusively on the human capital dimension, brings new insights on the economic analysis of child labor. In particular, there are new sources of potential inefficiencies that appear when we assume that labor induces some disutility. In such a case, household decisions regarding child labor may indeed be inefficient even if household members are altruistic, transfers are not at a corner and there are no market imperfections. Also, the presence of child labor disutility leads to an equilibrium where the conditions for an exogenous reduction of child labor to be Pareto improving are less likely to be fulfilled. This paper stresses therefore the fact that economic analysis should not forget one of the most important aspects of child labor, namely that it does not make children happy.

Suggested Citation

  • Antoine Bommier & Pierre Dubois, 2002. "Rotten Parents and Child Labor," Research Unit Working Papers 0202, Laboratoire d'Economie Appliquee, INRA.
    • Handle: RePEc:lea:leawpi:0202
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    1. M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
    2. 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.
    3. Bergstrom, Theodore C, 1989. "A Fresh Look at the Rotten Kid Theorem--and Other Household Mysteries," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1138-1159, October.
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    Cited by:

    1. Edmonds, Eric V. & Pavcnik, Nina, 2006. "International trade and child labor: Cross-country evidence," Journal of International Economics, Elsevier, vol. 68(1), pages 115-140, January.
    2. Eric V. Edmonds, 2005. "Does Child Labor Decline with Improving Economic Status?," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    3. Edmonds, Eric V., 2008. "Child Labor," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 57, pages 3607-3709, Elsevier.
    4. Moussa KEITA, 2014. "Pauvreté et arbitrage entre scolarisation et travail des enfants au Mali," Working Papers 201418, CERDI.
    5. Gugl, Elisabeth & Leroux, Justin, 2011. "Share the gain, share the pain? Almost transferable utility, changes in production possibilities, and bargaining solutions," Mathematical Social Sciences, Elsevier, vol. 62(3), pages 133-143.
    6. Wani Nelson Waru, 2020. "Impact of Trade Openness and Foreign Direct Investment on Child Labor; Evidence from Sub-Saharan African Countries," International Journal of Science and Business, IJSAB International, vol. 4(8), pages 127-145.
    7. Fabre, Alice & Pallage, Stéphane, 2015. "Child labor, idiosyncratic shocks, and social policy," Journal of Macroeconomics, Elsevier, vol. 45(C), pages 394-411.
    8. Elise S. Brezis, 2012. "Population Dynamics and Economic Growth: Should We Adopt Different Frameworks for Poor and Rich Countries?," Working Papers 2012-04, Bar-Ilan University, Department of Economics.
    9. Chaudhuri, Sanjukta, 2009. "The School Going Child Worker: An Analysis of Poverty, Asset Inequality and Child Education in Rural India," MPRA Paper 19687, University Library of Munich, Germany.
    10. Lutfullah Lutf & Shahadat I Haq Yasini, 2018. "Factors Contributing to Child Labor in Afghanistan: A Case Study in Jalalabad City," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 3, pages 348-372, September.
    11. Eric V. Edmonds, 2004. "Does Illiquidity Alter Child Labor and Schooling Decisions? Evidence from Household Responses to Anticipated Cash Transfers in South Africa," NBER Working Papers 10265, National Bureau of Economic Research, Inc.
    12. Edmonds, Eric V. & Pavcnik, Nina, 2005. "The effect of trade liberalization on child labor," Journal of International Economics, Elsevier, vol. 65(2), pages 401-419, March.
    13. Shunsuke Sakamoto, 2006. "Parental Attitudes toward Children and Child Labor: Evidence from Rural India," Hi-Stat Discussion Paper Series d05-136, Institute of Economic Research, Hitotsubashi University.
    14. Sonia Bhalotra, 2004. "Parent Altruism, Cash Transfers and Child Poverty," Bristol Economics Discussion Papers 04/561, School of Economics, University of Bristol, UK.

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    More about this item

    Keywords

    child labor; rotten kid theorem; human capital; collective household; altruism.;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • I20 - Health, Education, and Welfare - - Education - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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