Globalization and the Economics of Child Labor

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Table of Contents

Introduction
Article Summary
Analysis of Article
Discussion and Conclusion
References

Introduction

A defining characteristic of the 21st Century has been the phenomenal increase in the interaction of people from various countries. This interaction has resulted in the integration of economies and cultures in a process referred to as globalization. This phenomenon has had an effect on the labor practices of countries and especially on the child labor practice that plagues many developing nations.

Estimates by the International Labor Organization suggest that up to 250million children aged between 5 and 14 remain economically active (Clark, 2011). There is strong opposition to child labor from various actors on the global level for a number of reasons.

Child labor results in the loss of educational opportunities for children, compromises the safety of children and leads to their economic exploitation. In his article “Globalization and the Economics of Child Labor”, Edmond Eric advances that globalization has resulted in a significant reduction in child labor throughout the world.

Article Summary

Edmonds (2002) begins by highlighting that child labor is prevalent in the developing world with 250million children being involved in some form of child labor. The author documents that the employers of this child laborers are their impoverished parents.

The article reveals that in developing countries, a majority of child laborers work in the household setting with only 3% of children working outside of their household. Unpaid domestic work is the most common of child labor although some children also work in their family’s farm and business.

Edmonds (2002) states that the decision by parent to send their children to work is influenced by their economic realities. Impoverished households require their children to work since they cannot meet their basic needs without the input of their children. The author reveals that in the world’s poorest nations, it is not unusual to find up to 30% of children working which demonstrates the correlation of poverty to child labor.

The article suggests that globalization can affect child labor in two significant ways. One is by increasing employment opportunities to poor households hence raising their living standards. The second is by increasing the influence that rich countries can have on domestic policies of the developing world.

The enhancement of employment and earnings is possible through inflows of foreign investments as well as trade liberalization which increase wages in agricultural export sectors. With increased earnings, the parents can reduce the work that children perform and even afford to taken them to school.

The article also notes that globalization may expose a country to foreign competition therefore forcing firms in developing nations out of business. This will reduce the earning capacity of people and hence increase child labor. Entry of foreign multinationals may also depress the earning opportunities and wages of local workers. However, the author argues that foreign firms pay higher wages than local firms.

The article gives the Vietnam case as evidence of the positive effect that globalization has on reducing child labor. In Vietnam, an increase in rice prices due to liberalization resulted in the overall decline in child labor. This is because higher rice prices increase the price of rice wages and since adults earned more, they could afford to sustain their families without requiring the input of the child wages. This case demonstrated that child labor was prevalent due to poverty and dealing with poverty reduced the instances of child labor.

Analysis of Article

The article theorizes that globalization has an overall result of reducing child. This statement is corroborated by Clark (2011) who reveals that child labor rates fell across the world by more than 25% from 1980 to 2000. He states that while this drop may be explained by demographic transition, globalization also played a major role.

Globalization results in the mobility of capital across countries and this have huge implications especially on the economies of developing nations. Leung (2005) documents that in present times international trade has culminated in the emergence of a global economy which now has a direct bearing on the domestic economic growth and prosperity of each individual country.

The article asserts that globalization can increase the ability of developed nations to influence the policies of the world’s poorer nations. The US in particular is committed to promoting core labor standards which are aimed at ensuring that a set of standards are respected regardless of societal differences or levels of economic development (Stigliani, 2000).

The Clinton administration expanded its commitment to the elimination of child labor by becoming the first donor to the ILO’s IPEC program. The country enforced a legal ban on the importation into the US of goods made by indentured child labor (Stigliani, 2000). However, measures such as sanctions may have a negative impact in addressing child labor.

This is because such measures do not address the economic causes which make impoverished families continue to depend on this practice. A more effective approach to combating child labor is the promotion of socio-economic developments so as to address the real cause of child labor which is poverty.

Edmond (2002) proposes that child labor stems from poverty. This is true since child labor rates are highest in developing country with the rates in Africa being notably higher than elsewhere (Clark, 2011). This statement is corroborated by Clark (2011) who asserts that poverty is the most important reason why parents allow children to become economically active. Impoverished parents cannot afford to invest in the education of their children if it means losing the labor value that their children can provide at the present.

The author argues that globalization results in trade liberalization which significantly decreases the level of child labor in the country. This is because trade has the capacity to produce economic growth in a country and this significantly reduces poverty which is the primary cause of child labor.

Quinlivan and Davis (2003) assert that free trade results in significantly better life and substantially more socio-economic opportunities to individuals in developing countries. Studies have constantly revealed that a nation’s level of wealth is negatively associated with child labor (Clark, 2011; Cigno et al, 2002; Drenovsky, 1992).

Edmonds (2002) states that globalization can enhance employment and earnings in developing countries by bringing foreign investments into the country. According to him, this will result in higher wages and give developing countries a comparative advantage by increasing price of the export products. This assertion is disputed by a number of studies which demonstrate that foreign capital may result in additional child labor in a country.

While historically the main motivation for Foreign Direct Investment (FDI) was to gain access to natural resources that were available in the host country or increase proximity to the market, this has changed. The motivation for FDI today is primarily to exploit the available and abundant pool of labor in the host country.

Clark (2011) highlights that some developing nations rely on attracting foreign investment by supplying inexpensive labor to the investors who are keen to reduce their production costs. As it is, child workers form a docile and cheap labor pool that the investors can exploit. Foreign investment flows are therefore associated with greater child labor since they weaken the position of labor.

Discussion and Conclusion

The practice of child labor has become a growing serious concern in recent years. Ashagrie (2001) reveals that the number of working children worldwide may be higher than the recorded 250 million since there is lack of appropriate survey methodological approaches for probing into the work of children.

Means for eliminating this mostly detrimental practice should therefore be explored. The globalization phenomenon promises to have some impact on child labor (Kaufman & Rizzini, 2002). Globalization increase the earning power of the poor and the economic exchange harmonizes labor conditions across partners so as to promote fair trade principles and trading countries are supposed to live up to certain labor standards

This paper set out to analyze the article “Globalization and the Economics of Child Labor” by Edmond Eric in which the author advances that globalization has resulted in a significant reduction in child labor throughout the world. It has been seen that globalization does in deed have an effect on child labor. A country’s external links which occur through globalization shape its child labor practices. It can be stated that globalization is a potent force in mitigating child labor.

References

Ashagrie, K. (2001). Current progress in implementing new methods and conducting innovative surveys for measuring exploitation of children. Statistical Journal of the United Nations, 18(1): 187–203.

Clark, R. (2011). Child Labor in the world Polity: Decline and Persistence, 1980-2000. Social Forces, 89(3): 1033-1055.

Edmonds, E.V. (2002). Globalization and the Economics of Child Labor. Neue Zurcher Zeitung, 23(2): 29-35.

Kaufman, N.H. & Rizzini, I. (2002). Globalization and children: exploring potentials for enhancing opportunities in the lives of children and youth. NY: Springer.

Leung, K., et al. (2005). Culture and international business: recent advances and their implications for future research. Journal of International Business Studies, 36 (2): 357–378.

Quinlivan, G. & Davis, A. (2003). Ethical development and the social impact of globalization. International Journal on World Peace, 20 (2): 39-66.

Stigliani, N.A. (2000). Labor Diplomacy: A Revitalized Aspect of U.S. Foreign Policy in the Era of Globalization. International Studies Perspectives, 23(1): 177–194.

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