IDEAS home Printed from https://ideas.repec.org/p/bri/uobdis/03-554.html
   My bibliography  Save this paper

Is Child Work Necessary?

Author

Listed:
  • Sonia Bhalotra

Abstract

This paper investigates the hypothesis that child labour is compelled by poverty or that the child's income contribution is needed by the household in order to meet subsistence expenditures. We show that a testable implication of this hypothesis is that the wage elasticity of child labour supply is negative. Using a large household survey for rural Pakistan, labour supply models for boys and girls in wage work are estimated. Conditioning on non-labour income and a range of demographic variables, we identify a negative wage elasticity for boys and an elasticity that is insignificantly different from zero for girls. Thus while the evidence is consistent with boys working on account of poverty compulsions, the evidence is ambiguous in the case of girls. The results are argued to be of interest to recent theoretical and policy developments in this area.

Suggested Citation

  • Sonia Bhalotra, 2003. "Is Child Work Necessary?," Bristol Economics Discussion Papers 03/554, School of Economics, University of Bristol, UK.
  • Handle: RePEc:bri:uobdis:03/554
    as

    Download full text from publisher

    File URL: http://www.bristol.ac.uk/efm/media/workingpapers/working_papers/pdffiles/dp03554.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Richard Blundell & Ian Walker, 1986. "A Life-Cycle Consistent Empirical Model of Family Labour Supply Using Cross-Section Data," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 53(4), pages 539-558.
    2. Rajeev Dehejia & Roberta Gatti, 2002. "Child Labor: The Role of Income Variability and Access to Credit Across Countries," NBER Working Papers 9018, National Bureau of Economic Research, Inc.
    3. Emmanuel Skoufias & Susan Wendy Parker, 2001. "Conditional Cash Transfers and Their Impact on Child Work and Schooling: Evidence from the PROGRESA Program in Mexico," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2001), pages 45-96, August.
    4. Altonji, Joseph G, 1986. "Intertemporal Substitution in Labor Supply: Evidence from Micro Data," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 176-215, June.
    5. repec:bla:rdevec:v:4:y:2000:i:2:p:219-28 is not listed on IDEAS
    6. Alok Bhargava & J. D. Sargan, 2006. "Estimating Dynamic Random Effects Models From Panel Data Covering Short Time Periods," World Scientific Book Chapters, in: Econometrics, Statistics And Computational Approaches In Food And Health Sciences, chapter 1, pages 3-27, World Scientific Publishing Co. Pte. Ltd..
    7. Edmonds, Eric V., 2008. "Child Labor," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 57, pages 3607-3709, Elsevier.
    8. Case, Anne & Lin, I-Fen & McLanahan, Sara, 2000. "How Hungry Is the Selfish Gene?," Economic Journal, Royal Economic Society, vol. 110(466), pages 781-804, October.
    9. Basu, Kaushik & Van, Pham Hoang, 1998. "The Economics of Child Labor," American Economic Review, American Economic Association, vol. 88(3), pages 412-427, June.
    10. 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 777-791, July.
    11. 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.
    12. Alan Krueger, 1996. "Observations on International Labor Standards and Trade," Working Papers 741, Princeton University, Department of Economics, Industrial Relations Section..
    13. Nelson, Charles R & Startz, Richard, 1990. "The Distribution of the Instrumental Variables Estimator and Its t-Ratio When the Instrument Is a Poor One," The Journal of Business, University of Chicago Press, vol. 63(1), pages 125-140, January.
    14. Kaushik Basu & Zafiris Tzannatos, 2003. "The Global Child Labor Problem: What Do We Know and What Can We Do?," The World Bank Economic Review, World Bank, vol. 17(2), pages 147-173, December.
    15. Basu, Kaushik, 2000. "The Intriguing Relation between Adult Minimum Wage and Child Labour," Economic Journal, Royal Economic Society, vol. 110(462), pages 50-61, March.
    16. Canagarajah, Sudharshan & Coulombe, Harold, 1997. "Child labor and schooling in Ghana," Policy Research Working Paper Series 1844, The World Bank.
    17. Kooreman, Peter & Kapteyn, Arie, 1986. "Estimation of Rationed and Unrationed Household Labour Supply Functions Using Flexible Functional Forms," Economic Journal, Royal Economic Society, vol. 96(382), pages 398-412, June.
    18. Richard Blundell & John Ham & Costas Meghir, 1989. "Unemployment and Female Labour Supply," Palgrave Macmillan Books, in: Joan Muysken & Chris Neubourg (ed.), Unemployment in Europe, chapter 1, pages 9-36, Palgrave Macmillan.
    19. Appleton, S., 2000. "Education and Health at the Household Level in Sub-Saharan Africa," Papers 33, Chicago - Graduate School of Business.
    20. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    21. Newey, Whitney K & Powell, James L & Walker, James R, 1990. "Semiparametric Estimation of Selection Models: Some Empirical Results," American Economic Review, American Economic Association, vol. 80(2), pages 324-328, May.
    22. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    23. Kaushik Basu, 2006. "Gender and Say: a Model of Household Behaviour with Endogenously Determined Balance of Power," Economic Journal, Royal Economic Society, vol. 116(511), pages 558-580, April.
    24. Blundell, Richard & Macurdy, Thomas, 1999. "Labor supply: A review of alternative approaches," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 27, pages 1559-1695, Elsevier.
    25. Jafarey, Saqib & Lahiri, Sajal, 2002. "Will trade sanctions reduce child labour?: The role of credit markets," Journal of Development Economics, Elsevier, vol. 68(1), pages 137-156, June.
    26. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
    27. Glewwe, P. & Jacoby, H., 1993. "Delayed Primary School Enrollment and Childhood Malnutrition in Ghana, an Economic Analysis," Papers 98, World Bank - Living Standards Measurement.
    28. Hanan G. Jacoby & Emmanuel Skoufias, 1997. "Risk, Financial Markets, and Human Capital in a Developing Country," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 64(3), pages 311-335.
    29. Gary S. Becker & Nigel Tomes, 1994. "Human Capital and the Rise and Fall of Families," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition, pages 257-298, National Bureau of Economic Research, Inc.
    30. Swaminathan, Madhura, 1998. "Economic growth and the persistence of child labor: Evidence from an Indian city," World Development, Elsevier, vol. 26(8), pages 1513-1528, August.
    31. Kniesner, Thomas J, 1976. "An Indirect Test of Complementarity in a Family Labor Supply Model," Econometrica, Econometric Society, vol. 44(4), pages 651-669, July.
    32. Ranjan, Priya, 1999. "An economic analysis of child labor," Economics Letters, Elsevier, vol. 64(1), pages 99-105, July.
    33. F. Rosati & M. Rossi, 2001. "Children's Working Hours, School Enrolment and Human Capital Accumulation: Evidence from Pakistan and Nicaragua," UCW Working Paper 8, Understanding Children's Work (UCW Programme).
    34. Card, David, 1988. "Emperical tests of labor-market equilibrium: An evaluation : A comment," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 28(1), pages 259-267, January.
    35. Martin Shubik, 2001. "On Understanding Money," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 2(1), pages 95-120, January.
    36. Ranjan Ray, 2000. "Analysis of child labour in Peru and Pakistan: A comparative study," Journal of Population Economics, Springer;European Society for Population Economics, vol. 13(1), pages 3-19.
    37. Jean-Marie Baland & James A. Robinson, 2000. "Is Child Labor Inefficient?," Journal of Political Economy, University of Chicago Press, vol. 108(4), pages 663-679, August.
    38. Dehejia, Rajeev H. & Gatti, Roberta, 2002. "Child labor : the role of income variability and access to credit in a cross-section of countries," Policy Research Working Paper Series 2767, The World Bank.
    39. Christelle Dumas, 2007. "Why do parents make their children work? A test of the poverty hypothesis in rural areas of Burkina Faso," Oxford Economic Papers, Oxford University Press, vol. 59(2), pages 301-329, April.
    40. Bhalotra, Sonia & Heady, Chris, 2000. "Child farm labour: theory and evidence," LSE Research Online Documents on Economics 6654, London School of Economics and Political Science, LSE Library.
    41. David Card, 1994. "Earnings, Schooling, and Ability Revisited," Working Papers 710, Princeton University, Department of Economics, Industrial Relations Section..
    42. 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.
    43. Rosenzweig, Mark R & Evenson, Robert E, 1977. "Fertility, Schooling, and the Economic Contribution of Children in Rural India: An Econometric Analysis," Econometrica, Econometric Society, vol. 45(5), pages 1065-1079, July.
    44. Alan B. Krueger, 1996. "Observations on International Labor Standards and Trade," NBER Working Papers 5632, National Bureau of Economic Research, Inc.
    45. Baland, J.M. & Robinson, J.A., 1998. "A Model of Child Labor," Papers 9803, Southern California - Department of Economics.
    46. Jolliffe, Dean, 1997. "Whose education matters in the determination of household income," FCND discussion papers 39, International Food Policy Research Institute (IFPRI).
    47. Mroz, Thomas A, 1987. "The Sensitivity of an Empirical Model of Married Women's Hours of Work to Economic and Statistical Assumptions," Econometrica, Econometric Society, vol. 55(4), pages 765-799, July.
    48. Grootaert, Christiaan & Kanbur, Ravi, 1995. "Child labor : a review," Policy Research Working Paper Series 1454, The World Bank.
    49. Fortin, Bernard & Lacroix, Guy, 1997. "A Test of the Unitary and Collective Models of Household Labour Supply," Economic Journal, Royal Economic Society, vol. 107(443), pages 933-955, July.
    50. Costas Meghir & David Phillips, 2008. "Labour supply and taxes," IFS Working Papers W08/04, Institute for Fiscal Studies.
    51. Geeta Gandhi Kingdon, 1998. "Does the labour market explain lower female schooling in India?," Journal of Development Studies, Taylor & Francis Journals, vol. 35(1), pages 39-65.
    52. Alok Bhargava, 2006. "Identification and Panel Data Models with Endogenous Regressors," World Scientific Book Chapters, in: Econometrics, Statistics And Computational Approaches In Food And Health Sciences, chapter 3, pages 49-60, World Scientific Publishing Co. Pte. Ltd..
    53. John Shea, 1997. "Instrument Relevance in Multivariate Linear Models: A Simple Measure," The Review of Economics and Statistics, MIT Press, vol. 79(2), pages 348-352, May.
    54. Heckman, James J, 1974. "Shadow Prices, Market Wages, and Labor Supply," Econometrica, Econometric Society, vol. 42(4), pages 679-694, July.
    55. repec:fth:prinin:331 is not listed on IDEAS
    56. George Psacharopoulos, 1997. "Child labor versus educational attainment Some evidence from Latin America," Journal of Population Economics, Springer;European Society for Population Economics, vol. 10(4), pages 377-386.
    57. Peter Jensen & Helena Skyt Nielsen, 1997. "Child labour or school attendance? Evidence from Zambia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 10(4), pages 407-424.
    58. Alan B. Krueger & Andreas Mueller, 2011. "Job Search and Job Finding in a Period of Mass Unemployment: Evidence from High-Frequency Longitudinal Data," Working Papers 1295, Princeton University, Department of Economics, Center for Economic Policy Studies..
    59. Jere R. Behrman & Andrew D. Foster & Mark R. Rosenzweig & Prem Vashishtha, 1999. "Women's Schooling, Home Teaching, and Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 682-714, August.
    60. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    61. Nielsen, H.S., 1998. "Child Labor and School Attendance: Two Joint Decisions," Papers 98-15, Centre for Labour Market and Social Research, Danmark-.
    62. Sonia Bhalotra, 2004. "Parent Altruism, Cash Transfers and Child Poverty," Bristol Economics Discussion Papers 04/561, School of Economics, University of Bristol, UK.
    63. Pencavel, John, 1987. "Labor supply of men: A survey," Handbook of Labor Economics, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 1, pages 3-102, Elsevier.
    64. Sonia Bhalotra, 2003. "Child Labour in Africa," OECD Social, Employment and Migration Working Papers 4, OECD Publishing.
    65. Skoufias, Emmanuel & Parker, Susan W., 2001. "Conditional cash transfers and their impact on child work and schooling," FCND briefs 123, International Food Policy Research Institute (IFPRI).
    66. Emerson, Patrick M & Souza, Andre Portela, 2003. "Is There a Child Labor Trap? Intergenerational Persistence of Child Labor in Brazil," Economic Development and Cultural Change, University of Chicago Press, vol. 51(2), pages 375-398, January.
    67. Mark R. Rosenzweig, 1980. "Neoclassical Theory and the Optimizing Peasant: An Econometric Analysis of Market Family Labor Supply in a Developing Country," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(1), pages 31-55.
    68. Bhalotra, Sonia, 2002. "Parent Altruism," Royal Economic Society Annual Conference 2002 25, Royal Economic Society.
    69. Drusilla K. Brown & Alan V. Deardorff & Robert M. Stern, 2001. "Child Labor: Theory, Evidence and Policy," Discussion Papers Series, Department of Economics, Tufts University 0111, Department of Economics, Tufts University.
    70. Eric V. Edmonds, 2004. "Does Illiquidity Alter Child Labor and Schooling Decisions? Evidence from Household Responses to Anticipated Cash Transfers in South Africa," NBER Working Papers 10265, National Bureau of Economic Research, Inc.
    71. Shahnaz Hamid, 1994. "A Micro Analysis of Urban Child Labour: Some Determinants of Labour and its Conditions," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 33(4), pages 1249-1271.
    72. Dehejia, Rajeev H. & Beegle, Kathleen & Gatti, Roberta, 2003. "Child labor, income shocks, and access to credit," Policy Research Working Paper Series 3075, The World Bank.
    73. George Psacharopoulos & Harry Anthony Patrinos, 1997. "Family size, schooling and child labor in Peru - An empirical analysis," Journal of Population Economics, Springer;European Society for Population Economics, vol. 10(4), pages 387-405.
    74. Ray, Ranjan, 2000. "Child Labor, Child Schooling, and Their Interaction with Adult Labor: Empirical Evidence for Peru and Pakistan," The World Bank Economic Review, World Bank, vol. 14(2), pages 347-367, May.
    75. repec:fth:prinin:362 is not listed on IDEAS
    76. Fortin, B. & Lacroix, G., 1993. "A Test of the Neoclassical and Collective Models of Household Labour Supply," Papers 9335, Laval - Recherche en Politique Economique.
    77. Parsons, Donald O & Goldin, Claudia, 1989. "Parental Altruism and Self-Interest: Child Labor among Late Nineteenth-Century American Families," Economic Inquiry, Western Economic Association International, vol. 27(4), pages 637-659, October.
    78. Douglas A. Galbi, 1997. "Child labor and the division of labor in the early English cotton mills," Journal of Population Economics, Springer;European Society for Population Economics, vol. 10(4), pages 357-375.
    79. Sonia Bhalotra, and Zafiris Tzannatos, 2003. "Child labor : what have we learnt?," Social Protection Discussion Papers and Notes 27872, The World Bank.
    80. Barzel, Yoram & McDonald, Richard J, 1973. "Assets, Subsistence, and The Supply Curve of Labor," American Economic Review, American Economic Association, vol. 63(4), pages 621-633, September.
    81. James J. Heckman & Thomas E. Macurdy, 1980. "A Life Cycle Model of Female Labour Supply," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 47-74.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Drusilla K. Brown & Alan V. Deardorff & Robert M. Stern, 2009. "The Effects of Multinational Production on Wages and Working Conditions in Developing Countries," World Scientific Book Chapters, in: Globalization And International Trade Policies, chapter 17, pages 623-687, World Scientific Publishing Co. Pte. Ltd..
    2. Edmonds, Eric V., 2008. "Child Labor," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 57, pages 3607-3709, Elsevier.
    3. Lutfullah Lutf & Shahadat I Haq Yasini, 2018. "Factors Contributing to Child Labor in Afghanistan: A Case Study in Jalalabad City," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 3, pages 348-372, September.
    4. Jean-Pierre Lachaud, 2008. "Le travail des enfants et la pauvreté en Afrique : un réexamen appliqué au Burkina Faso," Economie & Prévision, La Documentation Française, vol. 0(5), pages 47-65.
    5. Heather Congdon Fors, 2012. "Child Labour: A Review Of Recent Theory And Evidence With Policy Implications," Journal of Economic Surveys, Wiley Blackwell, vol. 26(4), pages 570-593, September.
    6. Bhalotra, Sonia & Heady, Chris, 2000. "Child farm labour: theory and evidence," LSE Research Online Documents on Economics 6654, London School of Economics and Political Science, LSE Library.
    7. Wahba, J., 2006. "The influence of market wages and parental history on child labour and schooling in Egypt," Discussion Paper Series In Economics And Econometrics 603, Economics Division, School of Social Sciences, University of Southampton.
    8. Agus Priyambada & Asep Suryahadi & Sudarno Sumarto, "undated". "What Happened to Child Labor in Indonesia during the Economic Crisis: The Trade-off between School and Work," Working Papers 360, Publications Department.
    9. Ersado, Lire, 2002. "Child labor and school decisions in urban and rural areas," FCND briefs 145, International Food Policy Research Institute (IFPRI).
    10. Eric V. Edmonds & Norbert Schady, 2012. "Poverty Alleviation and Child Labor," American Economic Journal: Economic Policy, American Economic Association, vol. 4(4), pages 100-124, November.
    11. Pushkar Maitra & Ranjan Ray, 2002. "The Joint Estimation of Child Participation in Schooling and Employment: Comparative Evidence from Three Continents," Oxford Development Studies, Taylor & Francis Journals, vol. 30(1), pages 41-62.
    12. Kimhi, Ayal, 2007. "Does Land Reform In Transition Countries Increase Child Labor? Evidence From The Republic Of Georgia," Discussion Papers 7147, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
    13. Sonia Bhalotra & Christopher Heady, 2003. "Child Farm Labor: The Wealth Paradox," The World Bank Economic Review, World Bank, vol. 17(2), pages 197-227, December.
    14. Rana Ejaz Ali Khan, 2003. "Children in Different Activities: Child Schooling and Child Labour," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 42(2), pages 137-160.
    15. Ersado, Lire, 2005. "Child Labor and Schooling Decisions in Urban and Rural Areas: Comparative Evidence from Nepal, Peru, and Zimbabwe," World Development, Elsevier, vol. 33(3), pages 455-480, March.
    16. Ersado, Lire, 2003. "Child Labor And Schooling Decisions In Urban And Rural Areas: Cross-Country Evidence," 2003 Annual meeting, July 27-30, Montreal, Canada 21924, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    17. Vimefall, Elin, 2011. "What determines which children work? Empirical evidence from Kenya," Working Papers 2011:3, Örebro University, School of Business.
    18. Nadeem Ilahi & Peter F. Orazem & Guilherme Sedlacek, 2009. "How Does Working as a Child Affect Wages, Income, and Poverty as an Adult?," Palgrave Macmillan Books, in: Peter F. Orazem & Guilherme Sedlacek & Zafiris Tzannatos (ed.), Child Labor and Education in Latin America, chapter 5, pages 87-101, Palgrave Macmillan.
    19. Shunsuke Sakamoto, 2006. "Parental Attitudes toward Children and Child Labor: Evidence from Rural India," Hi-Stat Discussion Paper Series d05-136, Institute of Economic Research, Hitotsubashi University.
    20. Drusilla K. Brown & Alan V. Deardorff & Robert M Stern, 2001. "Child Labor: Theory, Evidence, and Policy," Working Papers 474, Research Seminar in International Economics, University of Michigan.

    More about this item

    Keywords

    child labour; education; poverty; gender; labour supply;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:bri:uobdis:03/554. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Vicky Jackson (email available below). General contact details of provider: https://edirc.repec.org/data/sebriuk.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.