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Poverty alleviation programs, FDI-led growth and child labour under agricultural dualism

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  • Dwibedi, Jayanta
  • Chaudhuri, Sarbajit

Abstract

The paper is aimed at providing a theoretical explanation why policies that affect only the supply side of the child labour problem may not be able to mitigate the incidence of child labour in a developing economy in terms of a three-sector general equilibrium model with agricultural dualism and child labour. Although a poverty alleviation program like subsidization of backward agriculture exerts a downward pressure on the child labour incidence through the supply side by raising adult wage income it ultimately worsens the problem by increasing the demand for child labour resulting from an expansion of backward agriculture. The paper finds that a policy of overall economic growth in the form of an FDI (foreign direct investment) is indeed able to put downward pressures on the child labour problem both through the demand and supply sides. Welfare of the child labour-supplying families also improves consequently.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 29997.

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Date of creation: 28 Feb 2011
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Handle: RePEc:pra:mprapa:29997

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Keywords: Child labour; general equilibrium; agricultural dualism; subsidy policy; poverty alleviation program; capital led growth;

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References

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  5. Chaudhuri, Sarbajit & Banerjee, Dibyendu, 2009. "Foreign Capital Inflow, Skilled-Unskilled Wage Inequality and Unemployment of Unskilled Labour in a Fair Wage Model," MPRA Paper 18004, University Library of Munich, Germany.
  6. Hamid Beladi & Sarbajit Chaudhuri & Shigemi Yabuuchi, 2008. "Can International Factor Mobility Reduce Wage Inequality in a Dual Economy?," Review of International Economics, Wiley Blackwell, vol. 16(5), pages 893-903, November.
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  12. Ranjan, Priya, 2001. "Credit constraints and the phenomenon of child labor," Journal of Development Economics, Elsevier, vol. 64(1), pages 81-102, February.
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  18. Chaudhuri, Sarbajit, 2007. "Mid-day Meal Program and Incidence of Child Labour in a Developing Economy," MPRA Paper 4367, University Library of Munich, Germany.
  19. Sarbajit Chaudhuri, 2005. "Tariff Structure In A Small Open Economy: A Theoretical Analysis," International Trade 0511006, EconWPA.
  20. Gupta, Manash Ranjan, 2000. "Wage Determination of a Child Worker: A Theoretical Analysis," Review of Development Economics, Wiley Blackwell, vol. 4(2), pages 219-28, June.
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  22. Chaudhuri, Sarbajit & Banerjee, Dibyendu, 2010. "FDI in agricultural land, welfare and unemployment in a developing economy," Research in Economics, Elsevier, vol. 64(4), pages 229-239, December.
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  24. Sarbajit Chaudhuri & Shigemi Yabuuchi & Ujjaini Mukhopadhyay, 2006. "Inflow Of Foreign Capital And Trade Liberalization In A Model With An Informal Sector And Urban Unemployment," Pacific Economic Review, Wiley Blackwell, vol. 11(1), pages 87-103, 02.
  25. Sarbajit Chaudhuri & Ujjaini Mukherjee, 2005. "Removal Of Protectionism, Foreign Investment And Welfare In A Model Of Informal Sector," International Trade 0511009, EconWPA.
  26. 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.
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  28. Sarbajit Chaudhuri & Ujjaini Mukhopadhyay, 2002. "Economic liberalization and welfare in a model with an informal sector," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 10(1), pages 143-172, March.
  29. Sarbajit Chaudhuri & Shigemi Yabuuchi, 2005. "Economic Liberalization And Wage Inequality In The Presence Of Labour Market Imperfection," International Trade 0510008, EconWPA.
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  31. Chaudhuri, Sarbajit, 2009. "Labour Market Reform and Incidence of Child Labour in a Developing Economy," MPRA Paper 19667, University Library of Munich, Germany.
  32. Basu, Kaushik, 1999. "The intriguing relation between adult minimum wage and child labor," Policy Research Working Paper Series 2173, The World Bank.
  33. Chaudhuri, Sarbajit, 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 353-64, October.
  34. Sarbajit Chaudhuri & Jayanta Kumar Dwibedi, 2007. "Foreign Capital Inflow, Fiscal Policies And Incidence Of Child Labour In A Developing Economy," Manchester School, University of Manchester, vol. 75(1), pages 17-46, 01.
  35. Chaudhuri, Sarbajit & Yabuuchi, Shigemi, 2007. "Foreign Capital and Skilled-unskilled Wage Inequality in a Developing Economy with Non-traded Goods," MPRA Paper 2645, University Library of Munich, Germany.
  36. Chaudhuri, Sarbajit, 2004. "International Migration of Skilled and Unskilled Labour, Welfare and Skilled-unskilled Wage Inequality: a Simple Model," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 19, pages 726-741.
  37. 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.
  38. Hamid Beladi & Avik Chakrabarti & Sugata Marjit, 2010. "Skilled-Unskilled Wage Inequality And Urban Unemployment," Economic Inquiry, Western Economic Association International, vol. 48(4), pages 997-1007, October.
  39. Chaudhuri, Sarbajit & Banerjee, Dibyendu, 2007. "Economic liberalization, capital mobility and informal wage in a small open economy: A theoretical analysis," Economic Modelling, Elsevier, vol. 24(6), pages 924-940, November.
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