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Estimating the Effect of Fertility Decisions on Child Labour and Schooling

We construct a joint distribution of fertility and children's activities treating the Poisson process generating the number of children as being endogenous in the multinomial logit process generating children's activities using a latent factor structure. Latent factors are incorporated into the equations for number of children and children's activities to allow for unobserved influences on fertility to affect children's activities, thus enabling us to make a distinction between selection on unobservables and selection on observables. We apply maximum simulated likelihood (MSL) techniques to estimate the parameters of our models. We find that the effect of fertility has a large downward bias in naive models. The marginal effect of fertility on child labor and schooling are twice as large when common unobserved heterogeneity in fertility and activity decisions are accounted for.

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Paper provided by Understanding Children's Work (UCW Programme) in its series UCW Working Paper with number 4.

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Date of creation: Feb 2004
Date of revision:
Handle: RePEc:ucw:worpap:4
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  1. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387, October.
  2. Ray, R., 1998. "Analysis of Child Labour in Peru and Pakistan: a Comparative Study," Papers 1998-05, Tasmania - Department of Economics.
  3. Shelly Lundberg & Elaina Rose, 2002. "The Effects Of Sons And Daughters On Men'S Labor Supply And Wages," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 251-268, May.
  4. Peter Jensen & Helena Skyt Nielsen, 1997. "Child labour or school attendance? Evidence from Zambia," Journal of Population Economics, Springer, vol. 10(4), pages 407-424.
  5. Carrasco, Raquel, 2001. "Binary Choice with Binary Endogenous Regressors in Panel Data: Estimating the Effect of Fertility on Female Labor Participation," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(4), pages 385-94, October.
  6. Pushkar Maitra & Ranjan Ray, 2000. "The Joint Estimation of Child Participation in Schooling and Employment: Comparative Evidence from Three Continents," ASARC Working Papers 2000-04, The Australian National University, Australia South Asia Research Centre.
  7. Gong, Xiaodong & van Soest, Arthur, 2000. "Family Structure and Female Labour Supply in Mexico City," IZA Discussion Papers 214, Institute for the Study of Labor (IZA).
  8. 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 C158-75, March.
  9. Brownstone, David & Train, Kenneth, 1999. "Forecasting new product penetration with flexible substitution patterns," University of California Transportation Center, Working Papers qt1j6814b3, University of California Transportation Center.
  10. Marco Francesconi, 2002. "A Joint Dynamic Model of Fertility and Work of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 20(2), pages 336-380, Part.
  11. Bhat, Chandra R., 2001. "Quasi-random maximum simulated likelihood estimation of the mixed multinomial logit model," Transportation Research Part B: Methodological, Elsevier, vol. 35(7), pages 677-693, August.
  12. Hotz, V Joseph & Miller, Robert A, 1988. "An Empirical Analysis of Life Cycle Fertility and Female Labor Supply," Econometrica, Econometric Society, vol. 56(1), pages 91-118, January.
  13. Moffitt, Robert, 1984. "Profiles of Fertility, Labour Supply and Wages of Married Women: A Complete Life-Cycle Model," Review of Economic Studies, Wiley Blackwell, vol. 51(2), pages 263-78, April.
  14. Edward Vytlacil & James J. Heckman, 2001. "Policy-Relevant Treatment Effects," American Economic Review, American Economic Association, vol. 91(2), pages 107-111, May.
  15. Blundell, Richard & Smith, Richard J., 1994. "Coherency and estimation in simultaneous models with censored or qualitative dependent variables," Journal of Econometrics, Elsevier, vol. 64(1-2), pages 355-373.
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