Economics at your fingertips  

Perverse Consequences of Well Intentioned Regulation: Evidence from India’s Child Labor Ban

Prashant Bharadwaj, Leah Lakdawala () and Nicholas Li ()

Journal of the European Economic Association, 2020, vol. 18, issue 3, 1158-1195

Abstract: Although bans against child labor are a ubiquitous policy tool, there is very little empirical evidence on their effectiveness. In this paper, we examine the consequences of India’s landmark legislation against child labor, the Child Labor (Prohibition and Regulation) Act of 1986. Using data from employment surveys conducted before and after the ban, and using age restrictions that determined whom the ban applied to, we show that the relative probability of child employment increases and child wages (relative to adult wages) decrease after the ban. Our main specification relies on comparing changes in work probabilities over time for children of the same age but with siblings who are rendered either eligible or ineligible for legal work when the ban is implemented. The increases in the probability of economic activity are largest for children (i) in areas where the industries targeted by the ban play a larger role in local labor markets, (ii) in areas where the probability of employer inspections is higher, and (iii) in families that are poorer. These results are consistent with a theoretical model building on the seminal work of Basu and Van (1998) and Basu (2005), where families use child labor to reach subsistence constraints and where child wages decrease in response to bans, leading poor families to utilize more child labor. We also find decreases in child participation in schooling (for younger children only) and no economically meaningful change in household outcomes like assets or calorie intake.

Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (6) Track citations by RSS feed

Downloads: (external link) (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Perverse Consequences of Well Intentioned Regulation: Evidence from India's Child Labor Ban (2013) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Journal of the European Economic Association is currently edited by Imran Rasul

More articles in Journal of the European Economic Association from European Economic Association
Bibliographic data for series maintained by Oxford University Press ().

Page updated 2022-11-27
Handle: RePEc:oup:jeurec:v:18:y:2020:i:3:p:1158-1195.