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Why does child labour persist with declining poverty?

Author

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  • Jayanta Sarkar

    () (QUT)

  • Dipanwita Sarkar

    () (QUT)

Abstract

Uneven success of poverty-based approaches calls for a re-think of the causes behind persistent child labour in many developing societies. We develop a theoretical model to highlight the role of income inequality as a channel of persistence. The interplay between income inequality and investments in human capital gives rise to a non-convergent dynamic path of income distribution characterised by clustering of steady state relative incomes around local poles. The child labour trap thus generated is shown to preserve itself despite rising per capita income. In this context, we demonstrate that redistributive policies, such as public provision of education can alleviate the trap, while a ceteris paribus ban on child labour is likely to aggravate it.

Suggested Citation

  • Jayanta Sarkar & Dipanwita Sarkar, 2012. "Why does child labour persist with declining poverty?," NCER Working Paper Series 84, National Centre for Econometric Research, revised 21 Nov 2012.
  • Handle: RePEc:qut:auncer:2012_7
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    References listed on IDEAS

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    Cited by:

    1. Bidisha Chakraborty & Kamalika Chakraborty, 2014. "Child Labour, human capital formation and size of landholding: short run and long run analysis," Economics Bulletin, AccessEcon, vol. 34(3), pages 2024-2037.
    2. Chakraborty, Bidisha & Chakraborty, Kamalika, 2016. "Low Level Equilibrium Trap, Unemployment, School Quality, Child Labour and Human Capital Formation," MPRA Paper 74621, University Library of Munich, Germany.
    3. Simone D’Alessandro & Tamara Fioroni, 2016. "Child labour and inequality," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(1), pages 63-79, March.
    4. Chakraborty, Kamalika & Chakraborty, Bidisha, 2016. "Learning by doing, low level equilibrium trap, and effect of domestic policies on child labour," MPRA Paper 74712, University Library of Munich, Germany.
    5. Aïssata COULIBALY, 2016. "Revisiting the Relationship between Financial Development and Child Labor in Developing Countries: Do Inequality and Institutions Matter?," Working Papers 201619, CERDI.
    6. Oryoie, Ali Reza & Alwang, Jeffrey & Tideman, Nicolaus, 2017. "Child Labor and Household Land Holding: Theory and Empirical Evidence from Zimbabwe," World Development, Elsevier, vol. 100(C), pages 45-58.
    7. Madeeha Gohar Qureshi & Saman Nazir & Hafsa Hina, 2014. "Child Work and Schooling in Pakistan— To What Extent Poverty and Other Demographic and Parental Background Matter?," PIDE-Working Papers 2014:105, Pakistan Institute of Development Economics.

    More about this item

    Keywords

    Child labour; Health; Human capital; Income inequality; Multiple equilibria;

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

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