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Consumer Product Labels, Child Labor and Educational Attainment

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  • Brown Drusilla K

    () (Tufts University)

Abstract

Child labor-free product labels are efficiency-enhancing when child welfare is a public good only if resources are generated to enhance the well-being of children. However, for a small price-taking economy with at least as many goods as factors and competitively supplied labels, the premium paid by consumers is dissipated by a production inefficiency associated with the adult-only technology. Child labor will decline if labeling firms bid the adult wage above the threshold at which families begin to withdraw their children from the workforce. Alternatively, monitoring agencies may offer consumers a donation label, which claims that some fraction of the purchase price will be donated to a child-welfare fund. A donation label is more efficient than the child labor-free label as it eliminates the production inefficiency and the inefficient competition among certification agencies. The standard contract offered in the child labor free labeling sector has elements of a donation label.

Suggested Citation

  • Brown Drusilla K, 2006. "Consumer Product Labels, Child Labor and Educational Attainment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-29, August.
  • Handle: RePEc:bpj:bejeap:v:contributions.5:y:2006:i:1:n:23
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    Cited by:

    1. Drusilla K Brown & Alan V Deardorff & Robert M Stern, 2013. "Labor Standards and Human Rights: Implications for International Trade and Investment," World Scientific Book Chapters,in: Regulation of Foreign Investment Challenges to International Harmonization, chapter 5, pages 153-195 World Scientific Publishing Co. Pte. Ltd..
    2. Edmonds, Eric V., 2008. "Child Labor," Handbook of Development Economics, Elsevier.
    3. Chakrabarty, Sayan & Grote, Ulrike, 2009. "Child Labor in Carpet Weaving: Impact of Social Labeling in India and Nepal," World Development, Elsevier, vol. 37(10), pages 1683-1693, October.

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