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Child Labor and Household Wealth: Theory and Empirical Evidence of an Inverted-U

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  • Basu, Kaushik

    (World Bank)

  • Das, Sanghamitra

    (Indian Statistical Institute)

  • Dutta, Bhaskar

    (University of Warwick)

Abstract

Some studies on child labor have shown that greater land wealth leads to higher child labor, thereby casting doubt on the hypothesis that child labor is caused by poverty. This paper argues that the missing ingredient is an explicit modeling of the labor market. We develop a simple model which suggests an inverted-U relationship between land holdings and child labor. A unique data set from India that has child labor hours information confirms this hypothesis. It is shown that the turning point beyond which more land leads to a decline in child labor occurs at 3.6 acres of land per household, which is well below the observed maximum value of land-holding.

Suggested Citation

  • Basu, Kaushik & Das, Sanghamitra & Dutta, Bhaskar, 2007. "Child Labor and Household Wealth: Theory and Empirical Evidence of an Inverted-U," IZA Discussion Papers 2736, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp2736
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    Keywords

    labor markets; child labor; land-holding; education;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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