Why does child labour persist with declining poverty?

Jayanta Sarkar and Dipanwita Sarkar ()

No 84, NCER Working Paper Series from National Centre for Econometric Research

Abstract: Uneven success of poverty-based approaches calls for a re-think of the causes behind persistent child labour in many developing societies. We develop a theoretical model to highlight the role of income inequality as a channel of persistence. The interplay between income inequality and investments in human capital gives rise to a non-convergent dynamic path of income distribution characterised by clustering of steady state relative incomes around local poles. The child labour trap thus generated is shown to preserve itself despite rising per capita income. In this context, we demonstrate that redistributive policies, such as public provision of education can alleviate the trap, while a ceteris paribus ban on child labour is likely to aggravate it.

Keywords: Child labour; Health; Human capital; Income inequality; Multiple equilibria (search for similar items in EconPapers)
JEL-codes: I1 J2 O1 O2 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2012-06-07, Revised 2012-11-21
New Economics Papers: this item is included in nep-dev, nep-dge, nep-hea and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Journal Article: WHY DOES CHILD LABOR PERSIST WITH DECLINING POVERTY? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:qut:auncer:2012_7

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