The Political Economy of Child Labor and Its mpacts on International Business

Business Economics, July, 2000 by S. L. Bachman

* In Western Europe and the United States industrial growth increased demand for skilled, adult labor and increased returns to education, thereby reducing child work, even before laws defining and curbing child labor were passed or implemented. Nardinelli's (1991) landmark analysis showed that historically child labor incidence began to fall well before countries in Western Europe adopted national laws banning child labor. Businesses using increasingly sophisticated technology demanded workers with more education and literacy, and greater industrial productivity led to higher incomes for those workers. The payoff for becoming a literate adult worker rose; and, therefore, so did the incentive for children to stay in school.

* Education is the most oft-cited "solution" to child labor. Compulsory education laws, as well as the implementation of those laws and the provision of schools, helped reduce child work simultaneously--and arguably were a precondition for later, rapid economic growth. Perhaps the most influential study on this trend was by Myron Weiner (1991). Weiner argued that actively taking children out of the work force and putting them into schools helped to lay the foundation for subsequent economic growth that further reduced child work. Weiner's emphasis on the importance of compulsory education laws has been widely challenged, but there is widespread agreement among child labor researchers on one point of this thesis: that even countries with relatively low per capita GDP could improve their human capital, boost their economic growth prospects and improve the lives of their citizens by providing affordable, appropriate and accessible education to all. In addition, there is widespread agreement among economists that the failure to educate children tends to retard national economies.

* The quality of schools is at least as important as quantity. Schools alone will fail to mitigate child labor if they are inaccessible, open at inappropriate hours of the day, offer poor teaching and teach subjects that students and their parents do not think will help children more than the skills a child can pick up on the job. [26]

* Some analyses show that reductions in child labor are at least in part a result of changes in public opinion, which attaches an increasing stigma to child work outside the home and/or increases the social value associated with attending school. Historians of childhood, beginning with the groundbreaking work of Philippe Aries in the 1960s, have documented a change in Western beliefs about childhood. In pre-modern days, childhood was not a separate period of life, and children were expected to work both inside and outside the home. Modem, Western concepts of childhood hold that childhood is a period that should be filled mostly with school and play, and many types of work are inappropriate or even morally wrong. [27] The clash between modem and traditional views of work as a natural activity for children results in some of the disagreements about how to define "child labor," discussed above. [28]