Our recent research shows that children are less likely to work in countries with more international trade. The negative association between trade and child labour holds even when considering only poor countries’ trade with high-income countries. It also holds up for trade in unskilled-labour intensive products. Quite simply, child labour is less prevalent in countries that trade more because countries that trade more are richer, and children work less in richer countries.
Income effects seem to outweigh the substitution effects when prices rise due to international trade. Their conclusions are worth keeping in mind:
Where does this research leave the concerned consumer? Stories of children engaged in export industries should be met with concern about why children hold those jobs. Before one boycotts a product with child labour content or supports punitive trade sanctions, one should ask whether these measures will make the child better off. Will boycotts or sanctions eliminate the reasons why children work? Thus far, most of the existing evidence suggests that eliminating sources of income will not make poor families better off. It will not change the circumstances that cause children to work.
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