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The Determinants of Child Labour: The Role of Primary Product Specialization

  • Leonardo Becchetti
  • Giovanni Trovato

The paper tests predictions of a traditional intra-household bargaining model which, under reasonable assumptions, shows that lack of bargaining power in the value chain significantly reduces the capacity of obtaining benefits from increased product demand arising from trade liberalization and therefore is positively associated with child labor. Cross-sectional and panel negative binomial estimates in a sample of emerging countries support this hypothesis showing that proxies of the labor force bargaining power in the international division of labor (such as the share of primary product exports) are significantly related to child labor, net of the effect of traditional controls such as parental income, the quality of education, international aid and trade liberalization. The positive impact of the share of primary product exports on child labor outlines a potential paradox. The paradox suggests that trade liberalisation has not always straightforward positive effects on social indicators and that its short run effects on income distribution and distribution of skills and market power across countries need to be carefully evaluated.

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1467-9914.2005.00303.x
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Article provided by CEIS in its journal LABOUR.

Volume (Year): 19 (2005)
Issue (Month): 2 (06)
Pages: 237-271

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Handle: RePEc:bla:labour:v:19:y:2005:i:2:p:237-271
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  1. Wacziarg, Romain & Wallack, Jessica Seddon, 2004. "Trade liberalization and intersectoral labor movements," Journal of International Economics, Elsevier, vol. 64(2), pages 411-439, December.
  2. Zadia M. Feliciano, 2001. "Workers and trade liberalization: The impact of trade reforms in Mexico on wages and employment," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 55(1), pages 95-115, October.
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  4. Basu, Kaushik, 1998. "Child labor : cause, consequence, and cure, with remarks on International Labor Standards," Policy Research Working Paper Series 2027, The World Bank.
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  6. Carol Ann Rogers & Kenneth A. Swinnerton, 1999. "The Economics of Child Labor: Comment," American Economic Review, American Economic Association, vol. 89(5), pages 1382-1385, December.
  7. Revenga, Ana, 1997. "Employment and Wage Effects of Trade Liberalization: The Case of Mexican Manufacturing," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages S20-43, July.
  8. Sachs, Jeffrey D & Warner, Andrew M, 1997. "Fundamental," American Economic Review, American Economic Association, vol. 87(2), pages 184-88, May.
  9. Dani Rodrik, 1997. "Has Globalization Gone Too Far?," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 57.
  10. Attanasio, Orazio & Goldberg, Pinelopi K. & Pavcnik, Nina, 2004. "Trade reforms and wage inequality in Colombia," Journal of Development Economics, Elsevier, vol. 74(2), pages 331-366, August.
  11. Robert C. Shelburne, 2001. "An Explanation of the International Variation in the Prevalence of Child Labour," The World Economy, Wiley Blackwell, vol. 24(3), pages 359-378, 03.
  12. Francisco Rodriguez & Dani Rodrik, 1999. "Trade Policy and Economic Growth: A Skeptic's Guide to Cross-National Evidence," NBER Working Papers 7081, National Bureau of Economic Research, Inc.
  13. Ranjan, Priya, 1999. "An economic analysis of child labor," Economics Letters, Elsevier, vol. 64(1), pages 99-105, July.
  14. Cigno, Alessandro & Rosati, Furio Camillo & Tzannatos, Zafiris, 2001. "Child labor, nutrition, and education in rural India : an economic analysis of parental choice and policy options," Social Protection Discussion Papers 24081, The World Bank.
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