Child Labor Supply Research Articles

The effect of parental health shocks on living arrangements and employment.

This study investigates the impacts of health shocks among older individuals on the dynamics of their living arrangements in Europe and the United States. Exploiting unpredicted health shocks, we use an event-study difference-in-differences approach to demonstrate that health shocks increase difficulties with activities of daily living and instrumental activities of daily living, thereby increasing the need for care. Our findings indicate that health shocks raise the probability of nursing home residency and co-residence with adult children by 0.7 and 1.4 percentage points in Europe, and by 2.1 and 1.8 percentage points in the U.S., respectively. Further analyses reveal that more generous long-term care public policies correlate with a higher probability of nursing home residency and a lower probability of co-residing with adult children, highlighting the significant role of public policies in household responses to health shocks. Additionally, we find that health shocks negatively impact adult children's labor supply, particularly in the U.S.

Child Tax Benefits and Labor Supply: Evidence from California

Child Tax Benefits and Labor Supply: Evidence from California

Child Tax Benefits and Labor Supply: Evidence from California

Child Tax Benefits and Labor Supply: Evidence from California

Health of Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers

Health of Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers

Household Preferences and Child Labor in Rural Ethiopia

Abstract This paper revisits the causes behind child labor supply by focusing on an aspect that has received little attention: the link between the household head's risk and time preferences and observed child labor supply. We develop a theoretical model and empirically test for this link using data from the seventh round of the Ethiopian Rural Household Survey. We find child labor at the extensive and intensive margins to be increasing in both higher adult discount rates and higher degrees of risk aversion, and this finding is robust across alternative empirical specifications. While higher time discount rates are supposed to favor child labor at the expense of schooling, the explanation of the positive link between risk aversion of the household head and observed child labor supply is nuanced. The most plausible explanation is that risk averse parents react to uncertain returns to education by combining child labor and schooling as opposed to substituting schooling for child labor.

Investigating the Determinants of Female Child Labour: An Analytic Hierarchy Process (AHP) Analysis

This exploratory article, on the basis of a comprehensive field survey, identifies and empirically examines the various key quantitative and qualitative determinants of female child labour in Haryana (India). These factors have been examined on three broader parameters, viz. economic, sociocultural and institutional by way of using a multiple-criteria decision-making (MCDM) technique, called the analytic hierarchy process model. The analysis clearly establishes that while the economic dynamics are certainly the elementary drivers of the supply of female child labour, this phenomenon is also attributed, and that too up to a significant extent, to several area-specific sociocultural factors, which are many times ignored. The study finds that three sub-criteria, viz. inadequate annual adult earnings, patriarchy and alcoholism have emerged as major sub-factors in this context. The outcomes of this study have several connotations, both for mitigation of the problem of female child labour as well as further research in this area. The government may emphasise more appropriate strategies like the improvements in labour market outcomes for socio-economically underprivileged sections, restraining alcoholism as well as creating awareness among the masses for bringing changes in the state’s orthodox cultural norms with regard to the girl children and child labour.

Relative Affluence and Child Labor—Explaining a Paradox

Some micro level empirical studies questioned the validity of the poverty hypothesis of child labour. In some cases child labour incidence found to be increasing even with improvement in the economic conditions of the poor. This paper provides a possible explanation as to why increase in absolute income may not be sufficient to solve the problem of child labour, at least in some cases. We argue that people in general are not just concerned about their own consumption; they are very much affected by the consumption of their peers. While taking decisions regarding the time allocation of their children between work and leisure, parents do keep an eye on their relative position in the society. We may have a situation where the absolute income of the poor is increasing but their relative position is the society is deteriorating and this may lead to an increase in child work. We develop a theoretical model of household decision making to show that child labour supply from a poor family can increase even with improvements in its economic conditions if the family’s relative position in the society deteriorates and if the relative concern effect is sufficiently strong.

Do courts know how to incentivize? Behavioral response of non-resident parents to child support obligations

In the case of divorce or separation, there are two kinds of maintenance regarding (minor) children: One parent provides food, housing, etc., the other parent compensates in the form of monthly payments. This study explores whether non-resident parents have responded to changes in the payments as laid down by the courts. Results for parents younger than 50 years old show that a €10 increase in monthly child support obligations decreases the likelihood of having an additional child by about 0.39 percentage points (about 3% at the sample mean). There is only weak evidence of a positive (re) marriage incentive. Furthermore, changing obligations do not have an impact on other post-separation behavior including child care and labor supply. To my knowledge, this investigation is the first causal analysis of unintentional side effects driven by courts’ changes in German child support guidelines. The potential endogeneity of child support obligations is addressed by using the German Socio-Economic Panel (SOEP) data from 1983–2013 and applying individual fixed-effects instrumental variable models.

Understanding Adult Children's Labor Supply Responses to Parents' Long-Term Care Needs

Understanding Adult Children's Labor Supply Responses to Parents' Long-Term Care Needs

Early Child Care and Labor Supply of Lower-Ses Mothers: A Randomized Controlled Trial

Early Child Care and Labor Supply of Lower-Ses Mothers: A Randomized Controlled Trial

Household Preferences and Child Labor in Rural Ethiopia

This paper revisits the causes behind child labor supply by focusing on an aspect that has received little attention: the link between the household head's risk and time preferences and observed child labor supply. We develop a theoretical model and empirically test for this causality using data from the seventh round of the Ethiopian Rural Household Survey. We find child labor to be increasing in both higher adult discount rates and higher degrees of risk aversion, and this finding is robust across alternative empirical approaches. Higher discount rates favor current consumption which is financed in part by child labor income while high risk aversion to future income (due to either low or uncertain returns to education) favor child labor at the expense of schooling.

자녀장려세제와 노동공급

자녀장려세제와 노동공급

Family Spillovers and Long-Term Care Insurance

We examine how the presence of long-term care insurance (LTCI) spills over to family outcomes, including informal care, co-residence, and labor supply of adult children. We instrument for long-term care insurance with changes in state tax policies to address the endogeneity of LTCI coverage. We find that for tax-filing families in the top third of the income distribution, LTCI coverage leads to a 50 percent reduction the parents’ perceptions of the willingness of people to care for them in the future, including their adult children. We also find that LTCI causes changes in the residential decisions of adult children, with lower co-residence rates and higher likelihood of living within 10 miles of the parent. We also find small decreases in part-time work among adult children. Our findings provide empirical support for the presence of family spillovers of LTCI on the economic behaviors of family members. Part of a symposium sponsored by the Economics of Aging Interest Group.

Health of Elderly Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers

We estimate the impact of parental health on adult children’s labor market outcomes. We focus on health shocks which increase care dependency abruptly. Our estimation strategy exploits the variation in the timing of shocks across treated families. Empirical results based on Austrian administrative data show a significant negative impact on labor market activities of children. This effect is more pronounced for daughters and for children who live close to their parents. Further analyses suggest informal caregiving as the most likely mechanism. The effect is muted after a liberalization of the formal care market, which sharply increased the supply of foreign care workers.

Child Support, Consumption, and Labor Supply Decisions of Single-Mother Families

This study estimates the causal effect of child support on consumption and labor supply of single mother families. Using data from the 1999 to 2013 waves of the Panel Study of Income Dynamics and the instrumental variable estimations that control for individual fixed effects, we do not find convincing evidence of significant influence of child support on consumption of custodial mother families. At the same time, we document a statistically significant and quantitatively important negative effect of child support on mothers’ probability of working and the amount of labor supplied. We also find the negative effect of child support on earnings conditional on positive labor income. We conclude that single mothers, especially those with weak attachment to labor force, might value time out of work, perhaps additional time spent with their children, more than the marginal gains in consumption.

‘And since that time has never been heard of…’ The forgotten boys of the sea: Marine Society merchant sea apprentices, 1772–1873

ABSTRACT The supply of child labour during Britain’s industrial revolution conjures mental imagery of destitute children toiling in mines and mills, but in recent years, historians have demonstrated that children worked in many nooks and crannies of the economy, not just the highly visible new industries. The shipping industry was a vital component of Britain’s commercial success in this period, yet the supply of boys has not received the same scrutiny as the children placed in the cotton industry. The Marine Society is best known for its pivotal role supplying the Royal Navy during manpower crises in the eighteenth century; this research highlights a lesser known aspect of its work, the recruitment of poor boys as apprentices to merchant ships. Using the Society’s apprenticeship registers, information has been gathered on 25,000 boys. Quantitative analysis is brought to life by contemporary newspaper reports and the Society’s treasure trove of correspondence, in order to develop not only a missing piece of maritime history, but also consider themes with wider significance to social and economic history. Individual tales of tragedy and triumph reveal what life was truly like for the boys who rode the crest of the wave, offering an empathetic element to the research.

The Effects of Parental Retirement on Adult Children's Labor Supply: Evidence From China

Aging and an increasing retired population are a global challenge. Previous studies suggest that retirement affects economic behaviors of the retiree and his or her spouse, including consumption, health outcome, and time use. However, little is known about the intergenerational effects of parental retirement on adult children. This paper studies the effects of parental retirement on adult children's labor supply through intergenerational time and monetary transfer. We exploit the mandatory retirement age in China as the cut-off point and apply a regression discontinuity (RD) approach to four waves of the China Family Panel Studies (CFPS) Dataset. Our findings suggest that parental retirement reduces adult children's annual hours of labor supply by 3 to 4 percent. This reduction is especially pronounced for female children. We find that the reduction can be explained by parents' increasing demand for time and care from children due to the significant drop in parents' self-rated health upon retirement. Although both male and female children increased their monetary and time transfers to parents, we find that parents tend to make more transfers to sons compared to daughters. Daughters are also more likely to make transfers to parents after they retire, both in terms of money and in terms of time. We therefore urge policy makers to increase formal eldercare provisions and provide workplace amenities such as flexible working hours, especially for female employees.

Health of Elderly Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers

We estimate the impact of parental health on adult children's labor market outcomes. We focus on health shocks which increase care dependency abruptly. Our estimation strategy exploits the variation in the timing of shocks across treated families. Empirical results based on Austrian administrative data show a significant negative impact on labor market activities of children. This effect is more pronounced for daughters and for children who live close to their parents. Further analyses suggest informal caregiving as the most likely mechanism. The effect is muted after a liberalization of the formal care market, which sharply increased the supply of foreign care workers.

A double safety net? Understanding interactions between disability benefits, formal assistance, and family support

While the main insurance sources for individuals with disability are understood, less is known about how family support interacts with federal disability benefits. Using the Health and Retirement Study matched to administrative records, I examine how disability benefits affect family support by comparing accepted and rejected disability applicants before and after benefit receipt. Receipt of disability insurance increases the probability of receiving any assistance from children by 18 percent and more than doubles the amount of in-kind assistance. Disability insurance also increases the probability that children are paid for their help and reduces children's labor supply. These findings are largest for low-income beneficiaries and those who recently lost a spouse, suggesting that child assistance complements income provided by disability insurance, and substitutes for other family assistance. Receipt of disability benefits allows the family to re-optimize how they provide support, and disability insurance is shared within the family in complementary ways.

The Impact Of Child Labor Eradication Programs In Brazil

After a period of falling child labor rates, Brazil has witnessed an increase in its incidence. There are two main federal policies against child labor in the country. The Child Labor Eradication Program (PETI) was created in 1996, designed with a conditional cash transfer approach that requires families to pull their children from labor situation and to have them attend school. The Bolsa Família Program (PBF) targets families living in poverty and extreme poverty via cash transfers conditional on school attendance and vaccination of children. Despite the PBF not directly addressing child labor, the two programs have been in integrated management since 2005. We use a comprehensive dataset covering the entire Brazilian population in 2010 to estimate the effect of each program individually on labor supply of children, both in terms of the extensive margin (probability of labor) and the intensive margin (weekly hours worked conditional on working). We adopt a Propensity Score Matching methodology, flexibly selecting covariates among a wide list of variables related to demographics and socioeconomic indicators of the children and their households, using the algorithm proposed by Imbens (2015) based on the repeated estimation of likelihood ratio tests. In order to consider possible heterogeneous effects, we also perform all estimation procedures separately for each Brazilian region. Our results suggest that the PBF is only able to reduce the probability of child labor in the South region, while the PETI only does so in the Southeast region. Disturbingly, both programs seem to increase the likelihood of child labor in the North and Northeast regions, which are the poorest in the country. On the other hand, when considering the intensive margin of child labor, we find that both PBF and PETI seem to be effective in diminishing weekly hours worked among children in the entire country (except for PETI in the South and Midwest, with less precise estimates). Our estimates also suggest that PETI conditionalities are not closely monitored. Furthermore, with the evidence indicating the programs can only partially reduce hours worked but are unable to remove children from the labor market, we interpret that cash transfer amounts might be insufficient to discourage child labor, especially those from PETI, which have not been updated since 1996.