Using data from Peruvian and Pakistani household surveys, Ray tests the hypotheses of a positive association between child labor hours and poverty and a negative association between child schooling and poverty.
Both hypotheses are confirmed using Pakistani data but not using Peruvian data.
What explains these divergent results?
The link between household poverty and child labor is much stronger in Pakistan than in Peru - perhaps partly because Pakistani schools are not as good as those in Peru, and perhaps partly because Pakistani families value education less, especially for girls. Also, Peruvian children combine schooling with employment, unlike Pakistani children.
Rising wages for men significantly reduce the labor hours of Peruvian girls. Strong complementarity exists between the labor market for women and that for girls in Pakistan.
Providing good schools in South Asia could help reduce child labor and break the strong link there between poverty and hours spent in child labor.
Data from both countries confirm the positive role more adult education can play in improving child welfare. Adult education's impact on child labor is considerably greater in Pakistan than in Peru. One generation's lack of skills and education causes the next to remain uneducated and unskilled as well.
This paper - a product of the Office of the Senior Vice President, Development Economics - is part of a larger study funded by the Bank's Research Support Budget under the research project "Intrahousehold Decisionmaking, Literacy, and Child Labor" (RPO 683-07). Copies of this paper are available free from the World Bank, 1818 H Street NW, Washington, DC 20433. Please contact Michelle Mason, room MC4-338, telephone 202-473-0809, fax 202-522-1158, Internet address mmason1@worldbank.org. The author may be contacted at ranjan.ray@utas.edu.au. (39 pages)
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