The Macroeconomics of Child Labor Regulation

FRB of Minneapolis Staff Report No. 354

49 Pages Posted: 9 Feb 2005

See all articles by Matthias Doepke

Matthias Doepke

Northwestern University - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Fabrizio Zilibotti

Yale University; Centre for Economic Policy Research (CEPR)

Date Written: February 2005

Abstract

We develop a positive theory of the adoption of child labor laws. Workers who compete with children in the labor market support the introduction of a child labor ban, unless their own working children provide a large fraction of family income. Since child labor income depends on family size, fertility decisions lockagents into specific political preferences, and multiple steady states can arise. The introduction of child labor laws can be triggered by skill-biased technological change that induces parents to choose smaller families. The model replicates features of the history of the U.K. in the nineteenth century, when regulations were introduced after a period of rising wage inequality, and coincided with rapidly declining fertility rates.

Keywords: Child Labor, Voting, Fertility, Inequality

JEL Classification: J13, J38, N30, O10, O30

Suggested Citation

Doepke, Matthias and Zilibotti, Fabrizio, The Macroeconomics of Child Labor Regulation (February 2005). FRB of Minneapolis Staff Report No. 354, Available at SSRN: https://ssrn.com/abstract=664613 or http://dx.doi.org/10.2139/ssrn.664613

Matthias Doepke (Contact Author)

Northwestern University - Department of Economics ( email )

2003 Sheridan Road
Evanston, IL 60208
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Fabrizio Zilibotti

Yale University ( email )

New Haven, CT 06520
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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