IDEAS home Printed from https://ideas.repec.org/a/ucp/ecdecc/y2005v53i4p913-32.html
   My bibliography  Save this article

Child Labor: The Role of Financial Development and Income Variability across Countries

Author

Listed:
  • Dehejia, Rajeev H
  • Gatti, Roberta

Abstract

In this article, we examine the link between child labor and financial development using cross-country data. We show that child labor and financial development display a significant negative relationship, which is particularly strong in the sample of low-income countries and is robust for a wide range of specifications and estimators, including fixed-effects and instrumental variables. We identify a plausible channel through which financial development affects child labor, as we find that income variability has a sizable, positive impact on child labor in countries where financial markets are underdeveloped, although this is not the case when financial markets are developed. Our results suggest that policies aimed at widening access to credit could be effective in reducing the extent of child labor.

Suggested Citation

  • Dehejia, Rajeev H & Gatti, Roberta, 2005. "Child Labor: The Role of Financial Development and Income Variability across Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 53(4), pages 913-932, July.
  • Handle: RePEc:ucp:ecdecc:y:2005:v:53:i:4:p:913-32
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/428714
    Download Restriction: Access to the online full text or PDF requires a subscription.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series,in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084 Central Bank of Chile.
    2. Ravallion, Martin & Wodon, Quentin, 2000. "Does Child Labour Displace Schooling? Evidence on Behavioural Responses to an Enrollment Subsidy," Economic Journal, Royal Economic Society, vol. 110(462), pages 158-175, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Del Carpio, Ximena V. & Loayza, Norman V. & Wada, Tomoko, 2016. "The Impact of Conditional Cash Transfers on the Amount and Type of Child Labor," World Development, Elsevier, vol. 80(C), pages 33-47.
    2. Hazarika, Gautam & Sarangi, Sudipta, 2008. "Household Access to Microcredit and Child Work in Rural Malawi," World Development, Elsevier, vol. 36(5), pages 843-859, May.
    3. Shimamura, Yasuharu & Lastarria-Cornhiel, Susana, 2010. "Credit Program Participation and Child Schooling in Rural Malawi," World Development, Elsevier, vol. 38(4), pages 567-580, April.
    4. Fabre, Alice & Pallage, Stéphane, 2015. "Child labor, idiosyncratic shocks, and social policy," Journal of Macroeconomics, Elsevier, vol. 45(C), pages 394-411.
    5. Asli Demirgüç-Kunt & Ross Levine, 2009. "Finance and Inequality: Theory and Evidence," Annual Review of Financial Economics, Annual Reviews, vol. 1(1), pages 287-318, November.
    6. Nguyen, Cuong Viet & Nguyen, Hoa Quynh, 2015. "Do internal and international remittances matter to health, education and labor of children and adolescents? The case of Vietnam," Children and Youth Services Review, Elsevier, vol. 58(C), pages 28-34.
    7. repec:eee:ecmode:v:69:y:2018:i:c:p:67-81 is not listed on IDEAS
    8. Delphine Boutin, 2011. "Envoi de fonds et allocation du temps des enfants au Niger : L’effet indirect des chocs négatifs," Larefi Working Papers 1105, Larefi, Université Bordeaux 4.
    9. Calero, Carla & Bedi, Arjun S. & Sparrow, Robert, 2009. "Remittances, Liquidity Constraints and Human Capital Investments in Ecuador," World Development, Elsevier, vol. 37(6), pages 1143-1154, June.
    10. repec:ebl:ecbull:v:30:y:2010:i:1:p:351-364 is not listed on IDEAS
    11. Alvi, Eskander & Dendir, Seife, 2011. "Weathering the Storms: Credit Receipt and Child Labor in the Aftermath of the Great Floods (1998) in Bangladesh," World Development, Elsevier, vol. 39(8), pages 1398-1409, August.
    12. Jean-Paul Fitoussi & Francesco Saraceno, 2008. "The intergenerational content of social spending : health care and sustainable growth in China," Sciences Po publications 2008-27, Sciences Po.
    13. Ebeke, Christian Hubert, 2012. "The power of remittances on the international prevalence of child labor," Structural Change and Economic Dynamics, Elsevier, vol. 23(4), pages 452-462.
    14. Delphine Boutin, 2011. "Envoi de fonds et allocation du temps des enfants au Niger : L'effet indirect des chocs négatifs," Working Papers hal-00637607, HAL.
    15. Karina Acevedo González & Raúl Quejada Pérez & Martha Yánez Contreras, 2011. "Determinantes y consecuencias del trabajo infantil: un análisis de la literatura," REVISTA FACULTAD DE CIENCIAS ECONÓMICAS, UNIVERSIDAD MILITAR NUEVA GRANADA, June.
    16. repec:spo:wpecon:info:hdl:2441/6741 is not listed on IDEAS

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:ecdecc:y:2005:v:53:i:4:p:913-32. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division). General contact details of provider: http://www.journals.uchicago.edu/EDCC/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.