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Foreign Capital, Return to Education and Child labour

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  • Dwibedi, Jayanta
  • Chaudhuri, Sarbajit

Abstract

This paper attempts to identify the different channels through which economic reforms can affect the incidence of child labour in a developing economy. Using a three-sector general equilibrium model it shows that inflows of foreign capital can lower the problem of child labour by raising the return to education and reducing the earning opportunities of children. It demonstrates how foreign capital produces favourable effect on the incidence of child labour although it affects wage inequality adversely.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 2646.

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Date of creation: 04 Mar 2007
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Handle: RePEc:pra:mprapa:2646

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Keywords: Child labour; general equilibrium; foreign capital; return to education; wage inequality;

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References

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  1. Cigno, Alessandro & Rosati, Furio C. & Guarcello, Lorenzo, 2002. "Does Globalization Increase Child Labor?," World Development, Elsevier, Elsevier, vol. 30(9), pages 1579-1589, September.
  2. Jones, Ronald W. & Peter Neary, J., 1984. "The positive theory of international trade," Handbook of International Economics, Elsevier, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 1, pages 1-62 Elsevier.
  3. Sugata Marjit & Hamid Beladi & Avik Chakrabarti, 2004. "Trade and Wage Inequality in Developing Countries," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 42(2), pages 295-303, April.
  4. Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, World Bank Group, vol. 11(1), pages 33-57, January.
  5. Camelia Minoiu & Sanjay G. Reddy, 2008. "Chinese Poverty: Assessing The Impact Of Alternative Assumptions," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 54(4), pages 572-596, December.
  6. Saqib Jafarey & Sajal Lahiri, 1999. "Will trade sanctions reduce child labour? The role of credit markets," Economics Discussion Papers, University of Essex, Department of Economics 500, University of Essex, Department of Economics.
  7. Yabuuchi, Shigemi & Chaudhuri, Sarbajit, 2007. "International migration of labour and skilled-unskilled wage inequality in a developing economy," Economic Modelling, Elsevier, Elsevier, vol. 24(1), pages 128-137, January.
  8. Wade, Robert Hunter, 2004. "Is Globalization Reducing Poverty and Inequality?," World Development, Elsevier, Elsevier, vol. 32(4), pages 567-589, April.
  9. Chaudhuri, Sarbajit & Yabuuchi, Shigemi, 2007. "Economic liberalization and wage inequality in the presence of labour market imperfection," International Review of Economics & Finance, Elsevier, Elsevier, vol. 16(4), pages 592-603.
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Citations

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Cited by:
  1. Dwibedi, Jayanta Kumar & Chaudhuri, Sarbajit, 2014. "Agricultural subsidy policies fail to deal with child labour under agricultural dualism: What could be the alternative policies?," Research in Economics, Elsevier, Elsevier, vol. 68(3), pages 277-291.
  2. Chaudhuri, Sarbajit, 2014. "Does Public Assistance for Skills Formation Necessarily Improve Wage Inequality in the Future?," MPRA Paper 57788, University Library of Munich, Germany.
  3. Chaudhuri, Sarbajit, 2010. "Economic recession, demand constraint and labour markets in a developing economy," MPRA Paper 27433, University Library of Munich, Germany.
  4. Dwibedi, Jayanta & Chaudhuri, Sarbajit, 2010. "Child labour in the presence of agricultural dualism: possible cures," MPRA Paper 23487, University Library of Munich, Germany.
  5. Chaudhuri, Sarbajit & Roychowdhury, Somasree, 2014. "Economic Reforms and Gender-based Wage Inequality in the Presence of Factor Market Distortions," MPRA Paper 54111, University Library of Munich, Germany.
  6. Dwibedi, Jayanta & Chaudhuri, Sarbajit, 2011. "Poverty alleviation programs, FDI-led growth and child labour under agricultural dualism," MPRA Paper 29997, University Library of Munich, Germany.
  7. Chaudhuri, Sarbajit, 2010. "Foreign Direct Investment, Child Labour and Unemployment of Unskilled Labour in a Dual Economy," MPRA Paper 20610, University Library of Munich, Germany.

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