Abstract:
This paper examines whether child labour affects the acquisition of a child's human capital. For this purpose, a behavioural model in which child labour is itself a choice and simultaneous equation models with limited dependent variables are employed to examine the determinants of human capital formation and its relationship with child labour. No trade-off relationship could be found between child labour and child schooling attainment. However, it was found that child labour is not detrimental to a child's health and nutritional status; rather, it improves these if children work within a critical threshold level.