Do WTO members employ less child labour?

Abstract

PurposeTrade liberalization could either exacerbate or ameliorate the incidence of child labour. This paper aims to examine the effect of trade liberalization through membership in the GATT/WTO on the incidence of child labour across countries and over time. The authors examine child labour force participation data and WTO membership for 94 countries between 1980 and 1999. They find that membership in the WTO is negatively correlated with child labour. However, they do not find a statistically significant relationship between openness and child labour and therefore rule out the trade‐expanding channel of WTO membership on child labour.Design/methodology/approachThe authors' regression equations examine the effect of GATT or WTO membership on the incidence of child labour. They examine data from 94 countries from 1980 and 1999 and employ a fixed‐effects regression. They estimate different models taking different variables as control variables. They find a statistically significant effect negative of WTO membership on the incidence of child labour. They do not find a statistically significant effect of openness on child labour.FindingsThe authors find that membership in the WTO did reduce child labour. They do not find a statistically significant effect of openness on child labour.Research limitations/implicationsWTO membership does not increase the incidence of child labour as some critics claim. Membership itself is associated with reduced child labour so it may not be necessary to expand trade through international agreements in order to impact the incidence of child labour.Practical implicationsContrary to critics of the WTO, membership does not exacerbate the problem of child labour.Originality/valueThis paper presents new data on child labour in a panel across countries over time. It is the first paper to systematically estimate the impact of international agreements on the incidence of child labour.