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Impact of adverse economic shocks on the Indian child labour market and the schooling of children of poor households

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  • Karan Singh, B

Abstract

This paper analyses the impact of adverse economic shocks on human capital formation in the case of India. It uses the extended theoretical model of Basu and Van (1998). The study has been carried out for the period between 1999 and 2002 and covers 385 districts. The results show that during a crisis, there is a fall in the school enrollment rate and a rise in the child labour participation rate. The study also argues that in the absence of a well-functioning credit market, to mitigate the adverse economic shocks on the children of poor households, the government must provide an incremental cash/in-kind conditional transfers to poor households with children.

Suggested Citation

  • Karan Singh, B, 2011. "Impact of adverse economic shocks on the Indian child labour market and the schooling of children of poor households," MPRA Paper 30958, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:30958
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    File URL: https://mpra.ub.uni-muenchen.de/30958/1/MPRA_paper_30958.pdf
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    References listed on IDEAS

    as
    1. Eric V. Edmonds & Nina Pavcnik, 2005. "Child Labor in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 199-220, Winter.
    2. Shawn Cole & Xavier Gine & Jeremy Tobacman & Petia Topalova & Robert Townsend & James Vickery, 2013. "Barriers to Household Risk Management: Evidence from India," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 104-135, January.
    3. 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.
    4. Lorenzo Guarcello & Fabrizia Mealli & Furio Rosati, 2010. "Household vulnerability and child labor: the effect of shocks, credit rationing, and insurance," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(1), pages 169-198, January.
    5. Basu, Kaushik & Das, Sanghamitra & Dutta, Bhaskar, 2010. "Child labor and household wealth: Theory and empirical evidence of an inverted-U," Journal of Development Economics, Elsevier, vol. 91(1), pages 8-14, January.
    6. Eric V. Edmonds & Nina Pavcnik & Petia Topalova, 2010. "Trade Adjustment and Human Capital Investments: Evidence from Indian Tariff Reform," American Economic Journal: Applied Economics, American Economic Association, vol. 2(4), pages 42-75, October.
    7. Hanan G. Jacoby & Emmanuel Skoufias, 1997. "Risk, Financial Markets, and Human Capital in a Developing Country," Review of Economic Studies, Oxford University Press, vol. 64(3), pages 311-335.
    8. 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.
    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. Michael Grimm, 2008. "Food Price Inflation and Children's Schooling," Discussion Papers of DIW Berlin 844, DIW Berlin, German Institute for Economic Research.
    11. Suzanne Duryea & Jere R. Behrman & Miguel Székely, 1999. "Schooling Investments and Macroeconomic Conditions: A Micro-Macro Investigation for Latin America and the Caribbean," Research Department Publications 4184, Inter-American Development Bank, Research Department.
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    Cited by:

    1. Fabre, Alice & Pallage, Stéphane, 2015. "Child labor, idiosyncratic shocks, and social policy," Journal of Macroeconomics, Elsevier, vol. 45(C), pages 394-411.
    2. Basab Dasgupta & Christian Zimmermann, 2012. "Loan regulation and child labor in rural India," Working Papers 2012-027, Federal Reserve Bank of St. Louis.

    More about this item

    Keywords

    Adverse economic shock; Child labour; Poverty; Labour market; Education; Human capital formation; Mid-day meal programme;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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