The Impact of Wealth on the Amount and Quality of Child Labor
This paper analyzes to what extent, and under what conditions, an increase in household wealth affects the use of child labor in poor households. It develops a simple theoretical model, which uses child labor, training, and schooling to maximize ho...
| Main Authors: | , |
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| Format: | Policy Research Working Paper |
| Language: | English |
| Published: |
2012
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| Subjects: | |
| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20120130155316 http://hdl.handle.net/10986/3244 |
| Summary: | This paper analyzes to what extent, and
under what conditions, an increase in household wealth
affects the use of child labor in poor households. It
develops a simple theoretical model, which uses child labor,
training, and schooling to maximize household income over
time, subject to resource constraints. Then, it conducts an
empirical analysis using randomized trial data, which were
collected for the evaluation of the 2006 Nicaragua
conditional cash transfer program. This social program
transfers wealth to poor families in rural areas,
conditional on children's school attendance and health
check-ups. In addition, for one third of the beneficiaries,
there is a further wealth transfer to start a
non-agricultural business. The paper finds that the
conditional cash transfer program affected the volume and
quality of child labor, reducing it in the aggregate and
steering it towards skill-forming activities. Specifically,
the program appears to have reduced the use of child labor
for household chores and farm work, while increasing it for
the non-traditional, skill-forming activities related to
commerce and retail. Moreover, the paper finds that the
source behind the increase in skill-forming child labor is
not the basic component, which provides a transfer for
paying for schooling and health services, but it's the
business-grant component, which provides a household grant
for the creation of a micro business or a new economic activity. |
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