Child labour

The problem of child labour is discussed over at the Economic Logic blog. Many organisations argue for a ban on child labour. Economists argue against such a ban on the grounds that in some cases poverty forces parents to send their kids out to work just to survive. These parents are consciously neglecting the future returns of schooling for the obvious need of immediate survival. It is also argued that proper infrastructure is needed, but is often missing, to make sure that kids would actually go to school if given the opportunity. Lastly bans or boycotts of particular products, based on a child labour, are now thought to be counterproductive as they impoverish even further the targeted populations.

At Economic Logic they continue

Matthias Doepke and Fabrizio Zilibotti add further arguments against bans and boycotts by considering their political economy aspect. A boycott or a ban from outside directly impacts only the export sector. Children are thus pushed to the non-traded sector, typically local agriculture where children engage in physically less demanding work than adults. Thus specialization occurs and children do not compete with adults. There is no local support for a child labor ban.

If there is no outside intervention, then children stay in the export sector and are in competition with the local unskilled adults. Those will now want to support a local ban of child labor so as to get rid of this competition for jobs. Thus, paradoxically, an attitude of laissez-faire in the rest of the world would lead to a child labor ban. Intervening would prevent the ban from happening.