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Although bans against child labor are a ubiquitous policy tool, there is very little empirical evidence on their effectiveness. In this paper, we examine the consequences of India’s landmark legislation against child labor, the Child Labor (Prohibition and Regulation) Act of 1986. Using data from employment surveys conducted before and after the ban, and using age restrictions that determined whom the ban applied to, we show that the relative probability of child employment increases and child wages (relative to adult wages) decrease after the ban. Our main specification relies on comparing changes in work probabilities over time for children of the same age but with siblings who are rendered either eligible or ineligible for legal work when the ban is implemented. The increases in the probability of economic activity are largest for children (i) in areas where the industries targeted by the ban play a larger role in local labor markets, (ii) in areas where the probability of employer inspections is higher, and (iii) in families that are poorer. These results are consistent with a theoretical model building on the seminal work of Basu and Van (1998) and Basu (2005), where families use child labor to reach subsistence constraints and where child wages decrease in response to bans, leading poor families to utilize more child labor. We also find decreases in child participation in schooling (for younger children only) and no economically meaningful change in household outcomes like assets or calorie intake.

Said for insightful discussions on the topic. Zachary Breig provided excellent research assistance. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

We examine the relationship between parental disability and child outcomes in the American Community Survey. We focus on families with veteran parents, for whom parental disability is a direct result of service-related activities and thus is more plausibly exogenous to child outcomes than other forms of parental disability. Using the service connected disability rating (SCDR) as a measure of the severity of veteran disability, we document a gradient in child outcomes with respect to parental disability (even conditional on having a disabled parent). Children with more severely disabled parents are more likely to be late for grade, less likely to be in private school, and more likely to have disabilities themselves. These results lend meaningful insight to broader populations; we find similar associations between parental disability and child outcomes in non-veteran families. We provide evidence consistent with two broad mechanisms: first, parental disability reduces parental labor supply and thus household income (even net of transfers) and second, children—especially older children—allocate time away from work and schooling to provide care for disabled parents.