The Role of Stigma Cost in Child Labor

The nuisance of child labor in underdeveloped and developing countries is a matter of grave concern. Exposing children into a vast world of the labor market at a susceptible phase of life leads to cutting down on their education, loss of creation of human capital and never-ending bad days for the country as a whole. These unfortunate children grow up and enter into the formal labor markets as unskilled laborers, destined to earn abysmally low wages throughout their adulthood. This vicious cycle of illegal, yet forced child labor continues for generations. Hence, the study and an effective course of action in this regard are peremptory. This paper tries to establish a model-theoretic framework of child labor from the supply sided point of view. It tries to investigate the determinants of supply of child labor through the parent’s problem of household time allocation for a child in the face of a trichotomy of working in the market, working at home, and study time. Assuming an altruistic attitude of parents, the paper solves a simple household utilization problem of family welfare, taking child labor in the household and markets as a constraint. It is established that the time allotted for child labor in both household and markets reduce significantly with the increase in adult income. The study further tries to analyze the effects of imposition of a socio-psychological stigma cost on the incidence of child labor. Finally, the paper discusses the various probable policy implementations which can be considered by the government either through direct abolition of child labor or by indirectly raising the stigma cost among masses.