Impact of Trade vs. Non-trade Policies on the Incidence of Child Labour

Date01 November 2016
Published date01 November 2016
AuthorRuna Ray,Biswajit Chatterjee
DOI10.1177/0015732516650807
Subject MatterArticles
/tmp/tmp-173vnTi8jQJ9k8/input Article
Impact of Trade vs.
Foreign Trade Review
51(4) 287–297
Non-trade Policies on the
©2016 Indian Institute of
Foreign Trade
Incidence of Child Labour:
SAGE Publications
sagepub.in/home.nav
A Two-sector General
DOI: 10.1177/0015732516650807
http://ftr.sagepub.com
Equilibrium Framework
Biswajit Chatterjee1
Runa Ray2
Abstract
The use of child labour has been widespread across developing nations. Although
the incidence of child labour use has declined in recent years in the aggregate, its
use has remained been quite widespread in different developing nations. Various
policy interventions have been suggested and debated in international bodies to
combat or reduce the incidence of child labour use in different activities in poor
labour abundant countries. The present article develops a general equilibrium
framework consisting of two sectors and three factors of production to investi-
gate the efficacy of trade and non-trade policies on the incidence of child labour
use and finds that although trade policy is ineffective in eradicating child labour,
the use of non-trade policy is quite effective in this context.
JEL: F10, J13
Keywords
Child labour, general equilibrium
Introduction
Child labour has been widely used in developing world, although its incidence
has diminished slightly in recent years, yet its use has remained quite high at the
global scale. Policies have been suggested to combat the use of child labour in
1 Professor of Economics, Jadavpur University, Kolkata, India.
2 Vidyasagar College, Kolkata, India.
Corresponding author:
Biswajit Chatterjee, Professor of Economics, Jadavpur University, Kolkata 700032, India.
E-mail: chatterjeeb@vsnl.net

288
Foreign Trade Review 51(4)
both developed and developing countries of the globe, yet the effectiveness of
such measures has remained limited. Such measures include banning the use of
child labour through legislations by the states and various support schemes to
help the poor children to come out of work and go to school. But the incidence
of child labour has remained quite high. According to the estimates by the ILO
(2013), 168 million children worldwide are in child labour, accounting for almost
11 per cent of the child population as a whole. Children in hazardous work that
directly endangers their health, safety and moral development make up more
than half of all child labourers, numbering 85 million in absolute terms. The larg-
est absolute number of child labourers is found in the Asia and the Pacific region
but Sub-Saharan Africa continues to be the region with the highest incidence of
child labour. According to the report, the decline in child labour was greatest
during the most recent four-year period (2008–2012). The Asia and the Pacific
region registered by far the largest absolute decline in child labour among 5- to
17–year-olds for the 2008–2012, and there had been reduction of the use of child
labour by about one-third during the period 2000–2012, of which there was a
reduction of 40 per cent in the number of girls in child labour as compared to 25
per cent for boys.
Following the Uruguay Round Agreement at Maracas, the World Trade
Organization (WTO) was formed with effect from 1 January 1995, with a view
to ensure fair and free trade practices among member countries. The WTO has
brought to focus the issues relating to labour standards and environment.
Regarding labour standards, the developed countries highlighted two points: the
first relates to core labour standards and the second to child labour. Regarding
the use of child labour, the demand of the developed nations has been that trade
in commodities using child labour in many developing nations is unfair, and be
banned—the children should go to school rather than to work. This position
sounds fair on ethical and normative grounds, but it ignores the hard realities of
the poor developing countries, where child labour use is conditioned by economic
compulsions of the poor parents. Children in these countries are sent to work
because their families are too poor to send them to school. When countries in
the European Union boycotted the export of garments manufactured in
Bangladesh on the ground that child labour was being used in manufacturing
them, thousands of children lost jobs and landed up in other worse paid jobs.
The fact is that developing countries are not in a position to take trade measures
against them to eliminate the incidence of child labour employment. Preventing
child labour use either by legislation, or by use of restrictive trade policies may
not be successful in eliminating the incidence...

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