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Social Conformity and Child Labor

  • Shirit Katav-Herz

    (Department of Economics, Bar Ilan University)

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    This paper investigates the phenomenon of child labor. I consider a society that in principle values education. Parents derive utility from social conformity, and “good” and “bad” equilibria can arise where the majority of children respectively do and do not go to school. In a “bad” equilibrium, social conformity sustains child labor, and I consider policies to change the equilibrium. Taxes on income from child labor may not be a feasible enforcement task for the tax administration. Incentive payments financed by domestic taxation can be provided to parents who send children to school, and can, but need not, discourage child labor. Also, again the domestic tax base may not be available. The effective and assured means of changing social norms to end child labor is externally financed incentive payments. Such payments can require extensive foreign assistance. However, when social norms underlie the phenomenon of child labor, the external assistance need only be temporary since the change in social norms is a case of hysteresis. After a period of time the incentive payments to parents can be removed, and an equilibrium where children go to school rather than work is sustained.

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    File URL: http://www.biu.ac.il/soc/ec/wp/14-01/14-01.pdf
    File Function: Working paper
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    Paper provided by Bar-Ilan University, Department of Economics in its series Working Papers with number 2001-14.

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    Date of creation: Jul 2001
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    Handle: RePEc:biu:wpaper:2001-14
    Contact details of provider: Postal: Faculty of Social Sciences, Bar Ilan University 52900 Ramat-Gan
    Phone: Phone: +972-3-5318345
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    Web page: http://www.biu.ac.il/soc/ecEmail:


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    1. Robert A. Margo & T. Aldrich Finegan, 1991. "The Decline in Black Teenage Labor Force Participation in the South, 1900-1970: The Role of Schooling," NBER Working Papers 3704, National Bureau of Economic Research, Inc.
    2. Moshe Hazan & Binyamin Berdugo, 2002. "Child Labour, Fertility, and Economic Growth," Economic Journal, Royal Economic Society, vol. 112(482), pages 810-828, October.
    3. Lindbeck, Assar & Nyberg, Sten & Weibull, Jörgen W., 1997. "Social Norms, the Welfare State, and Voting," Seminar Papers 608, Stockholm University, Institute for International Economic Studies.
    4. Ray, R., 1998. "Analysis of Child Labour in Peru and Pakistan: a Comparative Study," Papers 1998-05, Tasmania - Department of Economics.
    5. Assar Lindbeck & Sten Nyberg & Jšrgen W. Weibull, 1999. "Social Norms And Economic Incentives In The Welfare State," The Quarterly Journal of Economics, MIT Press, vol. 114(1), pages 1-35, February.
    6. Galor, Oded & Weil, David, 1995. "The Gender Gap, Fertility and Growth," CEPR Discussion Papers 1157, C.E.P.R. Discussion Papers.
    7. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-27, June.
    8. Ranjan, Priya, 1999. "An economic analysis of child labor," Economics Letters, Elsevier, vol. 64(1), pages 99-105, July.
    9. Moehling, Carolyn M., 1999. "State Child Labor Laws and the Decline of Child Labor," Explorations in Economic History, Elsevier, vol. 36(1), pages 72-106, January.
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