Most of the literature on child labour has discussed the issue of
child labour in connection with education. Connecting child labour with
education is very logical, as child labour is defined as an economic
activity of a child that affects the child's leisure, health and
particularly educational activities. Therefore, it points to a normative
view that every child, regardless of his or her background, should have
the right to receive at least a minimum amount of schooling. This is
because childhood is considered as the best time for the acquisition of
education, so childhood should be devoted to the accumulation of human
capital, particularly through formal schooling. Hence, any discussion of
child labour will lose importance if schooling is not incorporated into
it. Also, as it is a widely held view that work reduces the time
available for schooling by competing for the child's time with the
alternatives of schooling and leisure, it is therefore important to see
whether child labour helps or hurts the accumulation of human capital of
2. DETERMINANTS OF CHILD LABOUR AND SCHOOLING
There is an increasing number of literature that has focussed on
child labour and schooling. For example, Jensen and Nielsen (1997)
explored the effects of school attendance and child labour, using data
from Zambia. The results suggested that both economic and sociological
factors are responsible for the choice between school attendance and
child labour. According to their study, factors such as an imperfect
capital market and whether or not the household heads work affects
school attendance. For example, if the household head works in a formal
sector it increases the likelihood of the child's school
attendance. Canagarajah and Coulombe (1997) found from their econometric
analysis that household's welfare is highly correlated with school
participation and weakly correlated with the incidence of child labour.
Fathers with a relatively high level of education are likely to have a
negative effect on the likelihood of the child working, while
mothers' education affects only school participation. Khanam (2004)
also revealed similar effects of parental education on schooling of
Bangladeshi children. Ray's (2000) analysis indicated a gender
difference in girls' schooling in Pakistan and Peru; the bias (the
estimated coefficient is higher for Pakistan) was much stronger in
Pakistan than in Peru. Older Pakistani girls (age group of 10-14 years)
drop out from schooling completely to participate in the labour market.
Akabayashi and Psacharopoulos (1999) found a positive effect of the
mother's education and the availability of schools on school
attendance of girls in Tanzania. More siblings in the household make it
possible for female children to avoid household chores and find time to
attend school. However, using data from Bangladesh, Khanam (2007) found
that an increase in the number of pre-school children in the household
increases the probability that a girl will combine school with work
relative to the probability of study only. She also found that an
increase in the number total household member raises the probability
that a school-age child will study only relative to the probability that
the child will work only or combine work and study. Palacious (1981)
reported that parents in Colombia consider schooling as an obstacle to
learning working skills, as schools were scattered, curricula were
irrelevant for the needs of the rural poor, and educational equipments
3. IMPACT OF WORK ON SCHOOLING
There is a continued debate about whether working while in school
helps or hinders the prospect of a child. One school of thought argues
that a child can earn valuable human and psychological capital through
working while at school, in terms of self-esteem, competence,
responsibility and skills that make him or her confident to perform
better in school and later in the labour market (Mortimer and Johnson
1997). This argument is supported by many studies from developing
countries. These studies found that child labour does not hurt
schooling, and perhaps, it makes school possible for working children
and for their siblings. For instance, Ravallion and Wodon (2000), in
their study on Bangladesh, concluded that the adverse consequence of
child labour on schooling is likely to be very small. Binder and Scrogin
(1999) found in western Mexico that the academic performance of working
children is not lower relative to children who do not work, although
work reduces the hours of human capital investment. Patrinos and
Psacharopoulos's (1997) study on Peru also documented that child
labour is not harmful for schooling.
Another school of thought, however, argued that child labour
adversely affects a child's human capital formation in various ways
See, for example, Heady (2003), Nielsen (1998), Psacharopoulos (1997),
Akabayashi and Psacharopoulos (1999), Canagarajah and Coulumbe (1997),
Gunnarsson et al. (2003), Maitra and Ray (2002), Rosenzweig and Evenson
(1977), Rosatti and Rossi (2003) and Sasaki and Temesgen (1999), Khanam
(2004) and Khanam (2007). It also hampers child health, physical and
mental development. Child labour hurts school enrolment, attendance and,
particularly, school achievement (Khanam and Ross 2008). A study by
Boozer and Suri (2001) on Ghana found that an hour of child labour
decreases school attendance by .38 hours. Similarly, Lavy (1985) and
Rosenzweig and Evenson (1977) found that child labour markets lower
school enrolment and attendance. Khanam (2004) explored the linkages
between child work and both school attendance and school attainment of
children aged 5-17 years using data from a survey based in rural
Bangladesh. The central message from this study is that child labour
adversely affects the child's schooling, which is reflected in
lower school attendance and lower grade attainment. Using the 199596
Household expenditure survey of Bangladesh, Amin, Quayes and Rives
(2006) also found that child labour decreases the probability of
continuous schooling for Bangladeshi children.
The UNESCO also reported that about 18 per cent of children of
primary school-going age, that is, 110 million did not go to school in
1995; it is assumed that a majority of them were engaged in economic
activities (UNESCO 1996, as cited in ILO/UNICEF 1997). In Peru, 67 per
cent of working children are out of formal education (Matz 2002, p. 2).
According to available national surveys, from 50 per cent to 70 per cent
of working children combine schooling with child labour (ILO/UNICEF
1997). In many third-world countries, children usually go to school for
fewer hours and work for longer hours.
4. CHILD LABOUR AND SCHOOL ACHIEVEMENT
While most of the studies on the consequences of child labour on
schooling have paid attention to school enrolment or attendance, only a
few studies (See for example, Heady 2003; Psacharopoulos 1997; Admassie
and Bedi 2003; Gunnarsson et al. 2003 and Rosatti and Rossi 2003, Khanam
and Ross 2008) have examined the effect of child labour on academic
achievement or cognitive attainment. Lower school enrolment or
attendance may not represent the real consequences of child labour,
because these are simply indicators of time inputs for schooling, not
learning outcomes. Child labour could harm school achievement without
hurting school enrolment and even school attendance, which is possible
by reducing the leisure of a child. A few studies have attempted to
identify the effects of child labour on learning outcomes rather than
simply school attendance or enrolment.
In Ghana, for instance, Heady (2003) analysed the effect of
children's economic activity on their level of learning
achievement. The result showed that work has a substantial effect on the
learning achievement in the key areas of reading and mathematics. Work
has a much larger effect on advanced mathematical scores than that of
advanced reading scores. This effect is substantial on children's
mathematical skills, if they work outside the home. Therefore, Heady
concluded that children who worked as well as attending school found
themselves as being less able to learn as a result of exhaustion or a
lack of time to complete homework or a diversion of interest away from
Analysing the household survey data from two Latin American
countries, Bolivia and Venezuela, Psacharopoulos (1997) concluded that
working children have three times more likely to fail a grade in school.
He found that child labour reduces the educational attainment by about
two years of schooling for working children, relative to the non-working
children. Similarly, in Pakistan and Nicaragua, Rosati and Rossi (2003)
documented that increased hours of working were associated with poorer
test scores. In this connection, Gunnarsson et al.'s (2003) study
examining the effect of child labour on the academic achievements of 11
Latin American countries found that children who work sometimes outside
the home scored 12 per cent lower than the children who never worked in
the labour market. Children working frequently outside home scored up to
16 per cent lower than children who never worked.
Admassie and Bedi's (2003) findings in rural Ethiopia
regarding the consequences of work on the formal human capital
development of children are interesting. Admassie and Bedi detected a
nonlinear relationship between the hours of work and the school
attendance/reading and writing ability (RWA) of children. They found a
positive link between working and schooling/RWA initially. However, RWA
began to suffer if a child worked between 16-22 hours per week, although
it had no effect on school attendance. If a child worked beyond this
threshold, both school attendance and RWA suffered. Khanam and Ross
(2008) found that school attendance and grade attainment were lower for
children who were working.
From the above discussion it can be concluded that child labour
lowers school achievement in every country. Also, these adverse effects
of child labour on schooling outcomes are likely to be increased if a
child spends more time on labour activities outside the home (Heady
2003; Gunnarsson et al. 2003), and if the child works beyond a certain
threshold of hours (Admassie and Bedi's 2003). Thus, the perceived
view from the literature on child labour and schooling is that although
some work can be useful for a child, in most cases the benefits of work
are outweighed by its harmful effects on a child's physical, mental
and intellectual development.
5. COSTS AND BENEFITS OF EDUCATION
The parents' decisions regarding whether a child will attend
school or work are influenced by the cost and benefits of education and
job opportunities. Households incur direct costs (such as school
tuition, books and supplies and school uniforms) and indirect costs or
opportunity costs (such as time spent in the classroom, travel time, and
schoolwork at home) from enrolling a child in school. The time allocated
for schooling is input for education, which could otherwise be used for
market work or home production, and, hence, time spent on schooling
represents forgone income or gains to the household. Therefore parents
take into account the direct cost as well as the opportunity cost of
enrolling a child in school. A child will be sent to work if the cost of
schooling is higher than the benefit. Schooling creates long-term
effects that have effects on children; on the other hand the cost of
education is incurred in the short-term and will be borne by the
The cost of schooling may vary substantially between countries and
within countries. For example, in a study on Bangladesh, Ahmed and
Quasem (1991) observed a higher rate of school enrolment in a more
developed village where better facilities were available. Similarly, in
Tanzania, Akabayashi and Psacharopoulos (1999) revealed that in areas
with a lower school concentration children worked longer hours.
Therefore, poor school facilities, poor quality of education, and long
and costly travel to school make it difficult even for the middle-income
households to send the children to school. On the other hand, even the
poorest families can send their children to school in areas where good
quality free education is offered (Grimsrud 2001, p. 15). This can
explain why some studies fail to find an income effect in school
In the case of Ghana, however, it is found that the cost of
schooling can keep the children away from school (Canagarajah and
Coulombe 1997). The cost of education is also found to be a significant
barrier to school enrolment and completion for Egyptian children (Datt,
Jolliffe and Sharma 1997). The Survey of Child Labour in Egypt (1991)
also documented that 42 per cent of the families of working children
think that school expenses are very heavy for them. In Zambia, Nielsen
(1998) found that the effects of reducing education expenses by K1000
(An exchange rate of K420= US$1 is used in Nielsen, 1998 )would be an
increase in school attendance by about three percentage points in rural
areas and an increase in school attendance by less than 1 per cent in
the urban areas. It may also be the case that the high costs of
education push the children in the labour market so that they can afford
schooling for themselves or for their siblings. The lack of a credit
market for education in the developing countries makes the situation
worse. Further, low or declining returns of schooling put extra pressure
on households regarding the schooling decisions for the children, and
the result may be that children are kept away from school to avoid
Further, in many poor countries, the school curriculum is likely to
be irrelevant to the practical needs, teachers are unqualified or
inexperienced, the logistical supports are negligible, and classrooms
are unavailable or very small compared to the number of students. As a
result, quality education is almost absent, which discourages the
parents from sending their children to school. They consider school as a
waste of time, as there is no guarantee of getting a job after
completion of study. Rather, parents can financially benefit if the
6. CONCLUSIONS AND POLICY ISSUES
The studies reviewed in this paper point out that there is a
trade-off between child labour and schooling. The costs (both direct and
indirect cost) and benefits from education are considered by parents in
making schooling and child labour decisions. Evidence seems to support
the view that although some work can help children to acquire human
capital (in the form of on-the-job training, and the money earned from
child labour makes school possible for children themselves), in general,
child labour lowers the acquisition of education and human capital.
Moreover, the adverse effect of child labour on schooling outcomes is
likely to be increased if a child spends more time on labour activities
outside the home. Therefore, child labour has an opportunity cost in the
form of forgone human capital.
The elimination of child labour depends on the quality and
relevance of education services. Sometimes formal education is, however,
too stiff and rigid to meet the demands of the poor children. Therefore,
formal education should not be considered as the only option, it should
have some flexibility along with other options, such as education and
training. On the other hand, informal education is too flexible, with
low-quality education that cannot ensure further education and training
instead of literacy.
Easy and improved access to the credit market can significantly
increase school attendance and reduce child labour, as has been found to
be the case in Africa (Canagarajah and Nielson 1999). Income transfer
programmes, targeting the households living below poverty line can help
to stimulate demand for education by reducing the cost of education. For
instance, a targeted subsidy has been found to be very effective in
reducing child labour (Udry 2003). In the case of Bangladesh, Ravallion
and Wodon (2000) found that a targeted subsidy is more effective for
increasing school enrolment and attendance than in reducing child
labour. In the case of Bangladesh, Ravallion and Wodon (2000) found that
a targeted subsidy is not so effective in reducing child labour, as it
is found to be effective to increase school enrolment and duration. In
this case, increased school enrolment and school attendance may come at
the expense of leisure instead of labour. Hazan and Berdugo (2002) also
suggested that the introduction of compulsory schooling in a given
period and retributive taxation from adults to elderly people in the
following period could be an effective strategy to eradicate child
labour. They suggested this policy, as Baland and Robinson (2000)
claimed that if parents invest for a child's schooling in one
generation, children might not compensate their parents in the next
generation, as intergenerational contracts cannot be enforced.
Retributive taxation can compensate parents for the forgone earnings of
their children. Therefore, it has been found that an increase in the
supply of education is not enough to ensure school enrolment; the demand
side of education should also be targeted.
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Rasheda Khanam, University of Southern Queensland, Toowoomba, QLD,
Dr. Rasheda Khanam comes to the University of Southern Queensland
(USQ) from the University of Queensland (UQ) where she was a
Postdoctoral Research Fellow at the Australian Centre for Economic
Research on Health (ACERH). She gained a PhD in Economics from the
University of Sydney. In addition to her teaching commitments at the
USQ, the UQ, the University of Sydney and the University of Chittagong
over a period of 11 years, Dr Khanam has been actively involved with
research in the areas of Development Economics, Health Economics and
Labour Economics. She has published in prestigious economics journals
including the Journal of Health Economics and the Journal of Economic
Issues. Her research interests intersect with Development Economics,
Labour Economics and Health Economics.