Minimum Age Regulation and Child Labor: New Evidence from Brazil

Abstract

This study presents new evidence on the effects of minimum age regulations obtained from a natural experiment. In 1998, a constitutional reform in Brazil changed the minimum working age from 14 to 16. The reform was the legislative counterpart of a broad set of measures taken by a government strongly committed to eliminating child labor. This article investigates the role of the minimum working age in this context. The setting allows for improvements upon past approaches based on comparing employment rates of children at different ages. A discontinuity in treatment is exploited, namely the fact that only children who turned 14 after the enactment date (mid-December 1998) are banned from work. According to regression discontinuity and difference-in-discontinuity designs, the null hypothesis of no overall effect of the ban cannot be rejected. Throughout the methods and specifications, an employment effect in a confidence interval of $[-0.06, \, 0.03]$ (in percentage points) is found. A detailed heterogeneity analysis is performed and provides suggestive evidence of diminishing child labor trends in regions characterized by higher labor inspection intensity, which is interpreted as a trace of there being a law. However, contrary to what has been claimed in recent studies, the law seems not to have produced sizeable effects overall, at least in the short run. Power calculations and extensive sensitivity checks support these conclusions.

Exploring trends in the relationship between child labour, gender and educational achievement in Latin America

“…Psacharopoulos' (1997) analysis revealed significant partici-90 pation in the labour market among children who should be prevented from it by compulsory education or working age legislation. Similar evidence was found in Brazil by Bargain and Boutin (2017) and in data from 59 countries including Venezuela, the Dominican Republic and Bolivia by Edmonds and Shrestha (2012). Legislation often fails in eliminating child labour in its entirety as legislation does not cover the entire economy or only applies to specific activities or sectors (Boockmann, 2010).…”

“…In addition the prohibition of child labour (through minimum legal working age laws) is rarely applied uniformly across all activities. Thus, it may in fact merely lead to the reallocation of child labour into unregulated sectors such as family businesses or work happening inside the household where these laws do not apply or are even more difficult to enforce (Bargain & Boutin, 2017). Using a two-sector model of employment in which legislation completely eliminates child labour, Basu (2005) found that a ban via minimum age legislation in this model instead pushed children into unregulated work.…”

Economic Cost of Education and Behavior of Parents towards Child Labor

“…The benefits of education can be different for individuals and society (Bargain & Boutin, 2021). Most contemporary researchers in economics are interested in child labor because of the impact of child labor on human capital accumulation.…”

The Short- and Longer-Term Effects of a Child Labor Ban

“…We are aware of only five studies that investigate the e ects of an increase in the minimum employment age in developing countries: the aforementioned Piza and Souza (2016) and Bargain and Boutin (2021), Bharadwaj et al (2020), Kozhaya andMartinez Flores (2022), andEdmonds andShrestha (2012). Bharadwaj et al (2020) investigate the impact of the child labor ban in India and find that the law increased child labor in the informal sector and reduced wages.…”

“…In states with above-median inspection rates, the authors detect a 4 percentage points decrease in child labor. Even though Piza and Souza (2016) and Bargain and Boutin (2021) work on the 1999 wave of the Brazilian Household Survey (PNAD), it is important to describe the key di erences between the two studies.…”