The Impact of Trade Liberalisation on Household Welfare in a Developing Country with Imperfect Labour Markets

Abstract

I develop an empirical methodology to assess the distributional impact of trade-induced price shocks when labour markets are imperfect. The proposed methodology relates exogenous variations in prices to changes in household welfare using a separable agricultural household model that flexibly allows the data to determine the degree of labour market imperfections. Applying this approach to Vietnam, I investigate the impact of agriculture trade liberalisation between 1993 and 1998 on overall household welfare, measured using per capita household expenditure. I find that accounting for labour market imperfections results in welfare gains that are nearly four times larger than those found when assuming complete labour markets.     

Schooling Costs and Child Work in Rural Pakistan

A conventional argument in the child–labour debate is that improvements in access to schools are an effective way to reduce the labour force participation of children. It is argued that schooling competes with economic activity in the use of children's time, and enhanced access to schools, interpretable as reduction in schooling costs, may raise school attendance at the expense of child labour. In this article, we draw a distinction between child labour within the household (intra-household) and child work in the labour market (extra-household), and examine the separate effects of schooling costs upon these two types of child labour in rural Pakistan. Consistent, at least in part, with our theoretical framework, we find that extra-household child labour and schooling costs are positively related whereas intra-household child labour is insensitive to changes in the costs of schooling. Our results suggest that reduction in schooling costs will have limited success in the abatement of child labour in rural Pakistan.     

The Impact of Household Structure on Female Autonomy in Developing Countries

Abstract

Joint household structures in which several generations co-reside in a single house are common across developing countries. Such households may confer benefits on all the family members through household public goods with the patriarch exercising greater control over resources. Therefore, the household structure may affect the bargaining power of its members. This paper estimates the effect of joint versus nuclear household structure in India on the autonomy of women and their labour force participation and the heterogeneity in the effects by income, caste, and region. I use an instrumental variable approach and find that women living in nuclear households have greater decision-making power.     

Impacts of Migration on Household Production Choices: Evidence from China

Abstract

The great migration from Chinese farms to cities during the past several decades ranks among the most economically consequential of modern population movements. We use a national sample of rice-producing Chinese households to examine the effects of that migration on agricultural production. Our assessment involves evaluating four alternative theories of labour market equilibrium in the framework of an expanded agricultural household model. Migration’s farm production impacts appear to be slight, not on account of farm labour market perfections or remittance-financed technological improvements, but by substituting a reduction in leisure and other low-return activities for lost labour.     

Small-Scale irrigation and income distribution in Ethiopia

Abstract

Irrigation stimulates agricultural productivity and economic growth, but this may come at the cost of growing inequality. Using data at community and household level, this paper analyzes the distributional impacts of irrigation in Ethiopia. Regression analyses reveal the direct effects of irrigation on expenditures and labour demand, and the indirect effects of irrigation on food prices and expenditures of non-irrigation households. The results indicate that past development of irrigation stimulated growth without deepening inequality, and that irrigation decreased dependence on food-for-work programs. Thus, irrigation has played a positive role in the development of Ethiopia.     

Effects of Insurance on Child Labour: Ex-Ante and Ex-Post Behavioural Changes

In this paper we analyse possible effects of insurance on child labour. First, we develop a theoretical model that separates effects of insurance with and without a shock taking place. We then empirically test the hypotheses derived from the model by analysing the extension of a health insurance product in urban Hyderabad in Pakistan. Consistent with the theoretical model we develop in this paper, the reduction in child labour caused by the extension is largely due to an ex-ante feeling of protection as opposed to an ex-post shock-mitigation effect.     

Antipoverty Transfers and Labour Market Outcomes: Regression Discontinuity Design Findings

The article estimates the impact of Familias en Acción, a human development conditional cash transfer programme, on adult labour market outcomes in urban areas in Colombia. Relying on a regression discontinuity design and a large panel dataset, the article finds significant, largely positive, but heterogeneous programme effects on labour market outcomes. The findings suggest that antipoverty transfers enable a re-allocation of household productive resources among participant households.     

Wheels within Wheels: Poverty,Power and Patronage in the Cambodian Migration System

Abstract

This article presents evidence for an adjusted and refocused systems theory of labour migration in Cambodia. Specifically, it seeks to highlight first, how migration in Cambodia may be understood as a multi-scalar phenomenon characterised by pragmatism and flexibility; secondly, it emphasises the undergirding role of traditional rural norms in shaping and mediating the systematic process of labour movement; and finally, it presents evidence concerning how these structures constitute a vessel of social change, not only from urban to rural, but also from the rural to urban. In this way, a picture is presented of Cambodian migration as an adaptable, but nevertheless highly patterned process which is rapidly reordering the Kingdom’s cities and villages alike.     

Remittance Effects on Child Labour: Evidence from Burkina Faso

This article explores the effects of remittance receipt on child labour in an African context. We focus on Burkina Faso, a country with a high prevalence of child labour and a high rate of migration. Given the complex relationship between remittance receipt and household time allocation decisions, we instrument remittances using economic conditions in remittance-sending countries and explore heterogeneous effects across different types of potential remitters. While remittances have no significant effect on child labour on average, transfers reduce child labour in long-term migrant households, for whom the disruptive effect of migration is no longer felt. We find no gender difference but remittances seem to affect mainly the labour market participation of younger children.     

The Invisibility of Wage Employment in Statistics on the Informal Economy in Africa: Causes and Consequences

Abstract

This article challenges the claim, along with the statistics that support it, that self-employment is by far the dominant employment status in the informal economy. The article begins by reviewing key insights from relevant literature on the informal economy to argue that conventional notions of ‘wage employment’ and ‘self-employment’, while unfit for capturing the nature and variety of employment relations in developing countries, remain central to the design of surveys on the workforce therein. After putting statistics on Tanzania’s informal economy and labour force into context, the analysis reviews the type of wage employment relationships that can be found in one instance of the informal economy in urban Tanzania. The categories and terms used by workers to describe their employment situation are then contrasted with those used by the latest labour force survey in Tanzania. The article scrutinises how key employment categories have been translated from English into Swahili, how the translation biases respondents’ answers towards the term ‘self-employment’, and how this, in turn, leads to the statistical invisibility of wage labour in the informal economy. The article also looks at the consequences of this ‘statistical tragedy’ and at the dangers of conflating varied forms of employment, including wage labour, that differ markedly in their modes of operation and growth potential. Attention is also paid to the trade-offs faced by policy-makers in designing better labour force surveys.     

If They Grow It,Will They Eat and Grow? Evidence from Zambia on Agricultural Diversity and Child Undernutrition

Abstract

In this article we address a gap in our understanding of how household agricultural production diversity affects the diets and nutrition of young children living in rural farming communities in sub-Saharan Africa. The specific objectives of this article are to assess: (1) the association between household agricultural production diversity and child dietary diversity; and (2) the association between household agricultural production diversity and child nutritional status. We use household survey data collected from 3,040 households as part of the Realigning Agriculture for Improved Nutrition (RAIN) intervention in Zambia. The data indicate low agricultural diversity, low dietary diversity and high levels of chronic malnutrition overall in this area. We find a strong positive association between production diversity and dietary diversity among younger children aged 6–23 months, and significant positive associations between production diversity and height for age Z-scores and stunting among older children aged 24–59 months.     

Gone with the Storm: Rainfall Shocks and Household Wellbeing in Guatemala

This paper identifies the negative consequences of the strongest tropical storm ever to strike Guatemala on household welfare. Per capita consumption fell in urban areas, raising poverty substantially. Households cut back on food consumption and basic durables, and attempted to cope by increasing their adult and child labour supply. The mechanisms at play include the intensity of the shock, food prices and the timing of Agatha with respect to local harvest cycles. The results are robust to placebo treatments, migration and measurement error, and partly explain the increase in poverty in the country previously attributed solely to the collateral effects of the global financial crisis.     

Child Labour in Indonesian Small Industries

We analyse the geographic incidence of child labour in small manufacturing firms in Indonesia at the village level. Our unique data set covers virtually all Indonesian villages and urban neighbourhoods; it allows us to distinguish between demand and supply side determinants of child labour. We show by correcting for sample selection that a number of counterintuitive results – child labour being unaffected by credit access and school proximity – are the result of an interplay between supply and demand side determinants. Credit access and school proximity reduce child labour supply, but simultaneously constitute positive location factors for firms thereby increasing the demand for child labourers. To effectively reduce child labour, growth oriented policies, such as enhancing school and credit facilities, should be complemented by policies specifically geared towards increasing school attendance.     

Social Sustainability in Agriculture: An Anthropological Perspective on Child Labour in Cocoa Production in Ghana

Based on historical sources and ethnographic fieldwork in Ghana, the article presents child labour in cocoa communities as the outcome of a complex myriad of micro-level factors. It argues that many policy initiatives to address this problem have been hindered by a lack of understanding of the social and historical context impacting child rights in cocoa-producing communities. It also argues that by enabling a more grounded and gender-sensitive understanding of the household dimension of poor labour practices and of the plurality of factors underlying them, ethnography makes an important contribution to debates on unfree labour.     

Employment of Displaced and Non-Displaced Households in Luhansk and Donetsk Oblasti

Abstract

This essay investigates the employment of displaced and non-displaced households in a region next to the conflict zone. We show that the casually observed average 0–5% difference in employment between displaced and non-displaced household heads conceals positive selection into displacement. Relative to locals, internally displaced persons are positively selected based on observable as well as unobservable factors. After controlling for personal characteristics, the structure of the household, location, non-labour incomes and endogeneity of displacement, heads of IDP households are still 20% less likely to be employed two years after resettlement.     

Distributional Effects of Maize Price Increases in Malawi

Abstract

In the wake of highly volatile world prices of staple commodities, we examine the impacts of increases in maize prices on various categories of households in Malawi. Using household-level data, changes in household income are calculated taking into account the net maize production status of the household and food price elasticities estimated from a censored demand system. While maize price increases have unequivocal deleterious effects on the incomes of urban households, rural households experience differential impacts. Net producing households in rural areas benefit from price increases with households above the poverty line obtaining proportionally higher incomes.     

Women’s Empowerment Mitigates the Negative Effects of Low Production Diversity on Maternal and Child Nutrition in Nepal

Abstract

We use household survey data from Nepal to investigate relationships between women’s empowerment in agriculture and production diversity on maternal and child dietary diversity and anthropometric outcomes. Production diversity is positively associated with maternal and child dietary diversity, and weight-for-height z-scores. Women’s group membership, control over income, reduced workload, and overall empowerment are positively associated with better maternal nutrition. Control over income is positively associated with height-for-age z-scores (HAZ), and a lower gender parity gap improves children’s diets and HAZ. Women’s empowerment mitigates the negative effect of low production diversity on maternal and child dietary diversity and HAZ.     

Girl Farm Labour and Double-shift Schooling in The Gambia: The Paradox of Development Intervention

This article examines the intensification of Gambian girls’ domestic and farm labour contributions as a result of the introduction of double-shift schooling. Drawing on fieldwork among female farmers and their daughters in Brikama the article puts forth the following arguments: doubleshift schooling facilitates the intensification and increased appropriation of surplus value from girls’ household and farm labour because girls are more readily able to meet gendered labour obligations that are central to the moral economy of the household and to the demands of agrarian production; secondly, double-shift schooling highlights the paradoxical nature of development intervention where, on the one hand, legislation and policy call for a reduction in child labour by increasing access to school and, on the other, neo-liberal educational policy serves to facilitate the intensification of girls’ domestic and farm labour. This paper maintains that the intensification of girls’ workmust be placed within a wider context where children’s — particularly girls — cheap, flexible and/or unremunerated labour is central to the functioning of local and global processes of accumulation.     

Does Health Insurance Reduce Child Labour and Education Gaps? Evidence from Rwanda

A common practice of poor households to informally deal with risk is to allocate children’s time away from school towards income-generating activities or household production. Focussing on Rwanda, this study investigates whether the provision of formal health insurance helps to prevent this undesired risk coping strategy. We find that children of households enrolled in health insurance work significantly less compared to those of not enrolled families, and also have better educational achievements. The results suggest that policy interventions which reduce household risk exposure may have additional benefits in terms of lower child labour supply and higher schooling levels.     

Shridath S Ramphal

This paper aims to explore a number of lessons learned from the disaster management experience in Turkey in response to the Marmara earthquake in August 1999. It discusses the shortcomings of disaster mitigation and preparedness measures in Turkey in the context of a disaster and development relationship, including a number of issues such as legislation and training, public awareness, insurance, urban planning and management, and disaster response strategies. It explains why this earthquake produced such a large impact and suggests why, unlike previous earthquakes, the public reaction to the shortcomings in disaster mitigation and preparedness for the earthquake may promote important changes within Turkish society. Through the investigation of disaster management practice in the light of lessons learned from the Marmara earthquake experience, the paper outlines possible responses to these shortcomings.