From Malthus to Modern Growth: Child Labor, Schooling and Human Capital

35 Pages Posted: 4 Aug 2009

See all articles by Edgar Vogel

Edgar Vogel

Deutsche Bundesbank; Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA)

Date Written: February 16, 2009

Abstract

This paper develops a dynamic general equilibrium model of fertility, human capital accumulation, child labor and uncertain child survival focusing on the qualitative and quantitative effect of declining mortality on household decisions and economic development. Due to uncertainty about child survival, parents have a precautionary demand for children. Rising survival probability leads to falling fertility, eventually to investment into schooling and the demise of child labor. Child labor can be an obstacle to development since it lowers the incentives of parents to educate children. Furthermore, the paper argues that the decline of precautionary child demand as a consequence of falling mortality is not sufficient to generate a demographic transition. Falling mortality can only explain a relatively small part of the fertility decline. A sizable reduction in fertility can only be achieved by human capital investment and the induced quantity-quality trade off.

Keywords: Demographic transition, child mortality, precautionary demand, child labor, human capital,

JEL Classification: J11, J13, I12, O11, O40

Suggested Citation

Vogel, Edgar, From Malthus to Modern Growth: Child Labor, Schooling and Human Capital (February 16, 2009). MEA Discussion Paper No. 180-09, Available at SSRN: https://ssrn.com/abstract=1443949 or http://dx.doi.org/10.2139/ssrn.1443949

Edgar Vogel (Contact Author)

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Strasse 14
Frankfurt am Main, 60431
Germany

HOME PAGE: http://www.bundesbank.de

Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA) ( email )

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Munich, 80799
Germany

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