Describe the different public policies proposed to eradicate child labour.

Contents

1. Introduction

2. Proposed policies to eradicate child labour
2.1 Determinants of child labour
2.2 Seven policies to eradicate child labour
2.2.1 Population policies
2.2.2 Development of credit markets
2.2.3 Labour market reforms
2.2.4 Trade liberalization and economic integration
2.2.5 Trade sanctions
2.2.6 Total ban on child labour
2.2.7 Compulsory school attendance

3. Evaluation and concluding remarks

4. Bibliography

5. Appendix: Figures and tables

1. Introduction

In recent years well-known organizations and companies such as the FIFA^[1], Nestlé and Nike have seen their reputation suffering through disastrous media reports pillorying the use of child labour in the production of their goods and the hazardous conditions under which the affected children had to work. While the FIFA and Nike were accused of selling sports goods (handmade footballs) made by exploited children under the age of 14 in so-called ‘sweatshops’, Nestlé was blamed for contracting suppliers of cacao beans who allegedly had abducted children to work forcedly on cacao plantations in Côte d’Ivoire. Although the named firms have taken actions to ensure fair trading in the future, these occurrences show that the effects of child labour do not only concern underdeveloped, poor countries but that they can also impinge on richer economies.

According to one of the latest reports released by UNICEF^[2] in June 2006, more than 190.7 million children aged 5-14 years are currently engaged in child labour. While the Asian and Pacific regions harbour the largest absolute number of child workers (127.3 million, 19%), it is Sub-Saharan Africa which has the highest participation rate (29%, 48 million). Many of these children are forced into debt bondage, are misused as soldiers in armed conflicts or trafficked into prostitution. Other estimates from the ILO^[3] state that in 1995 there were up to 120 million children under the age of 15 carrying out paid work^[4]. This figure, it claims, would rise to 250 million if part-time work and household activities were to be included as ‘child labour’. Obviously the estimates can vary widely depending on the data used and the definition of ‘work’ and ‘child’ but the ILO Convention No. 138 of 1973 seems to be a reasonable benchmark. It sets the minimum age for the admission to employment or work to at least 15 years. Children below that age are consequently regarded as economically active if the work they perform prevents them from a proper school attendance.

This essay aims to describe and evaluate the different policies proposed to curb child labour. Thus it will be divided into two parts, the first dealing with the description and the second with the evaluation.

2. Proposed policies to eradicate child labour

In order to have a better understanding of the objectives of the different policies proposed so far, we will first outline the main determinants of child labour. The evaluation will then revise how effectively each package of measures addresses them.

2.1 Determinants of child labour

On the supply side the determining factors for child labour are fertility (household size), time allocation, risk management, parental education and household income. On the demand side the structure of the labour market and the prevailing production technology are pre-eminent.

Fertility and the parental decision of how to allocate a child’s time to work, education and leisure, clearly conditions the potential supply of child labour. In addition, Lloyd (1994) finds that the probability that a child will work if the household size increases depends on four factors, namely the level of socio-economic development, the level of social expenditure, cultural factors and the phase of demographic transition. From his statements one can deduct that the probability of child labour in a large household will be lowest if it is located in a rural, less developed area with high government expenditures, an extended family system for child fostering and an increasing birth rate / death rate ratio (e.g. due to reduced infant mortality). In very poor households, where parents have no secured job and survival is threatened by failed harvests, income from child labour often contributes crucially to the smoothing of the income stream. Furthermore, in regions without social security systems and borrowing possibilities, the income and transfers from children may be the only pension source available. Parental education not only influences their income but also cultural factors such as the realisation that child labour might be a ‘bad’ for the child and should be subordinated to school education. Finally, the overall household income and wealth, which in turn depends on all the factors mentioned above, will determine the need for additional earnings from child labour.

The structure of the labour market as a demand side determinant is constituted by the level of wages, their flexibility and competitiveness. In the absence of more developed production machinery children often have to perform tasks, which adults are hardly capable of (e.g. to tie small carpet knots, to crawl through small tunnels in mines). This implies that improvements in technology can ameliorate child welfare.

2.2 Seven policies to eradicate child labour

Basu (1998)^[5] argues that there are three kinds of policies and institutions that target child labour. On the intra-national level he mentions the laws that a country enacts and the interventions undertaken to improve child well-being within the national boundary. On the supra-national level the most powerful tools to curb child labour are international labour standards and conventions, which can be used by international organizations (ILO, WTO^[6] ) to put forward punitive actions against countries that deliberately ignore them. Basu classifies laws or standards as extra-national if they are imposed in one country but are likely to deter also others from allowing children to contribute to the production of goods (e.g. Harkin’s Bill or Sander’s Amendments which ban U.S. imports that are not ‘child-labour-free’). In the following we characterize seven policies that aim to abolish child labour.

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^[1] Fédération Internationale de Football Association

^[2] United Nations International Children’s Emergency Fund

^[3] International Labour Organization

^[4] Wages measured in cash or in kind

^[5] Basu, K. (1998), Child Labour: Cause, Consequence and Cure with Remarks on International Labour Standards, Journal of Economic Literature, Vol. 37, pp. 1083-1119

^[6] World Trade Organization