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Child Labor and Resistance to Change

We study the interaction between technological innovation, investment in human capital and child labour. In a two-stage game, first firms decide on innovation, then households decide on education. In equilibrium the presence of inefficient child labour depends on parameters related to technology, parents' altruism and the diffusion of firms' property. Child labour is due either to firms' reluctance to innovate or to households' unwillingness to educate, or both. In some cases, compulsory schooling laws or a ban on child labour are welfare-reducing, whereas a subsidy for innovation is the right tool to eliminate child labour and increase welfare. Copyright (c) The London School of Economics and Political Science 2005.

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Paper provided by Dipartimento Scienze Economiche, Universita' di Bologna in its series Working Papers with number 474.

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Date of creation: 2003
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Handle: RePEc:bol:bodewp:474
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  1. Oded Galor & Omer Moav, 2000. "Das Human Kapital," Working Papers 2000-17, Brown University, Department of Economics.
  2. Levy, Victor, 1985. "Cropping Pattern, Mechanization, Child Labor, and Fertility Behavior in a Farming Economy: Rural Egypt," Economic Development and Cultural Change, University of Chicago Press, vol. 33(4), pages 777-91, July.
  3. Carol Ann Rogers & Kenneth A. Swinnerton, 1999. "Inequality, Productivity, and Child Labor," Labor and Demography 9907003, EconWPA, revised 30 Jul 1999.
  4. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-27, June.
  5. Ranjan, Priya, 2001. "Credit constraints and the phenomenon of child labor," Journal of Development Economics, Elsevier, vol. 64(1), pages 81-102, February.
  6. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1989. "Industrialization and the Big Push," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1003-26, October.
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  8. Alessandro Cigno & Furio C. Rosati, 2007. "Why do Indian Children Work, and is it Bad for Them?," Working Papers id:1252, eSocialSciences.
  9. G. Bellettini & C. Berti Ceroni, 2000. "Compulsory schooling laws and the cure against child labor," Working Papers 394, Dipartimento Scienze Economiche, Universita' di Bologna.
  10. Kaushik Basu, 1999. "Child Labor: Cause, Consequence, and Cure, with Remarks on International Labor Standards," Journal of Economic Literature, American Economic Association, vol. 37(3), pages 1083-1119, September.
  11. Paul Segerstrom & Elias Dinopoulos, 1999. "A Schumpeterian Model of Protection and Relative Wages," American Economic Review, American Economic Association, vol. 89(3), pages 450-472, June.
  12. Dessy, Sylvain E. & Pallage, Stephane, 2001. "Child labor and coordination failures," Journal of Development Economics, Elsevier, vol. 65(2), pages 469-476, August.
  13. Douglas A. Galbi, 1997. "Child labor and the division of labor in the early English cotton mills," Journal of Population Economics, Springer, vol. 10(4), pages 357-375.
  14. Giorgio Bellettini & Carlotta Berti Ceroni, 2004. "Compulsory Schooling Laws and the Cure for Child Labour," Bulletin of Economic Research, Wiley Blackwell, vol. 56(3), pages 227-239, 07.
  15. 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.
  16. Dessy, Sylvain E., 2000. "A defense of compulsive measures against child labor," Journal of Development Economics, Elsevier, vol. 62(1), pages 261-275, June.
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