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Plantation Development in Southwest India

Annotation: Child labor constitutes “a facet of poverty.” The authors argue that by precluding children from obtaining an education, their human capital accumulation and future earnings potential are impaired, and their social and cognitive skills are diminished. The labor that is substituted for education also increases children’s health hazards. Child labor as an economic choice made by families is not “pareto efficient” (no individual can be made better off without another being made worse off) in two ways: when used by parents as a substitute for income, or as a substitute for borrowing. Studies of policy implications show that an effective ban on child labor may engender economic improvement because endogenous changes in wages may make parents and companies better off.