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Globalization, Child Labour and Development Policies: A Theoretical Analysis


  • Rakhi Banerjee

    (Rakhi Banerjee, Assistant Professor, Department of Economics, Gurudas College, Kolkata. E-mail:

  • Ranjanendra Narayan Nag

    (Ranjanendra Narayan Nag, Associate Professor, Department of Economics, St. Xaviers’ College (Autonomous), Kolkata. E-mail:


Incidence of child labour is a disturbing feature of an emerging market economy. In the present article, we will try to explore whether globalization policies, namely, agricultural trade liberalization and methods aimed at attracting foreign direct investment (FDI), have had any negative impact on the incidence of child labour in a developing economy. We will also examine whether decrease in incidence of child labour would increase social welfare and welfare of the child labour-supplying family unambiguously. For our work, we use a three-sector general equilibrium structure. We intend to highlight that effects of globalization are crucially dependent on factor-intensity ranking and factor specificity. Multiple cross effects that are present in a three-sector general equilibrium structure are the driving forces behind the results.

Suggested Citation

  • Rakhi Banerjee & Ranjanendra Narayan Nag, 2013. "Globalization, Child Labour and Development Policies: A Theoretical Analysis," Foreign Trade Review, , vol. 48(1), pages 83-104, February.
  • Handle: RePEc:sae:fortra:v:48:y:2013:i:1:p:83-104

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    More about this item


    Child labour; agricultural dualism; globalization; FDI; Agricultural Trade Liberalization; child labour; welfare; D50; F11; F63; I131;

    JEL classification:

    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development


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