The effects of globalization on child labor in developing countries

Abstract

This paper inquires the effects of globalization on child labor in developing countries via cross-country analysis by decomposing globalization to its components; foreign direct investment (FDI) and trade. The findings reveal that the relationship between the child labor supply and gross domestic product per capita (PCGDP) can be expressed as a U shape. The study indicates that the child labor increases in the developing countries whose PCGDP levels are above 7 500 USD since the net effect of globalization is positive for the positive substitution effect is bigger than the negative income effect. Data have been collected from UNICEF and World Bank.