INTERNATIONALBANK FOR WORLD BANK R E T C N O E N STRUCTION PM AND DEVELO September 2002 No.9 A regular series of notes highlighting recent lessons emerging from the operational and analytical program of the World Bank`s Latin America and Caribbean Region CHILD LABOR IN BOLIVIA AND COLOMBIA Harry Anthony Patrinos and Christiaan Grootaert Overview Figure 1 - Decision Tree for Chile Labor Model According to the International Labor Organization, 120 mil- Schooling (P1) lion children work full-time worldwide. Virtually all live in Wage work (P2) poor countries. Legislation has been passed to ban child la- All other Work in home bor, but it is not enforced or does not address the root options Enterprise (P3) causes of the practices such as low income and the opportu- All other options nity costs of a child's attending school rather than contribut- No work (P4) ing to household income. All Children Children not Children not in "A Four-Country Comparative Study of Child Labor" by in school school and not working Christiaan Grootaert and Harry Anthony Patrinos was pre- sented at the Economics of Child Labor Conference in Oslo, The specific definition of the choices may need to be ad- in May 2002. The paper was based on a longer study fo- justed for some countries. In Bolivia and Colombia an addi- cused on the labor supply decision by the household and tional probit was estimated in order to model in more detail identified the key factors affecting child labor, most notably the school and work combination. The first stage (P1) exam- household size and composition, education and employment ines the decision to work for the entire sample of children, status of parents, the household's ability to cope with fluc- the second stage (P2) the decision to work full time rather tuations on the supply side, and the functioning of the labor than combine school and employment. The third and fourth market and the prevailing technologies on the demand side. probits (P3 and P4) examine the determinants of wage work and home care work among children who only work. Methodology The datasets used for the model estimation came from multi- purpose household surveys that recorded labor force partici- The decision tree in Figure 1 portrays the sequential deci- pation for all members. The age cut off was seven years for sion making process. Bolivia and Colombia. The surveys were nationally The World Bank and Child Labor The World Bank recognizes that child labor is one of the most devastating consequences of persistent poverty and has adopted a clear position to help reduce harmful child labor through its ongoing poverty reduction efforts and new initiatives. Housed in the Human Development Network's Social Protection Unit the Global Child Labor Program was established to develop knowledge and identify strategies to enhance the effectiveness and impact of the World Bank's work on children through its ongoing poverty reduction efforts. The Program functions as the Bank's focal point for child labor activities, training and ca- pacity building. Partnerships have been and continue to be essential to achieving these objectives. Learn more at http://www1.worldbank.org/sp/childlabor/ 1 representative except for Bolivia where only urban areas · Location also has a strong effect on child labor deci- were covered. Table 1 shows the proportion of children sions. The probability of child labor is always higher in working in Colombia and Bolivia. rural areas than in urban areas. Table 1- Proportion of Children Working Child Labor in Latin America Labor and School Profile Colombia Bolivia Urban Rural Urban Bolivia Children who only work 13.5% 25.0% 8.8% (P3 and P4) As the poorest country in South America and second only to Haiti in its incidence of poverty in Latin America, Bolivia Children who work 19.5% 34.1% 12.5% has urban and rural poverty rates of 60 and 80 percent. Of (P2) those children attending school, only 15 percent attend school beyond the fifth grade and only 10 percent of pri- mary school age children complete the primary cycle. General Findings There are several reasons for the delays including repetition: one half of the working children claim to attend school, and most working children migrated from rural areas where they · The child's age and gender are important determinants of were offered only 3 years of primary schooling. Of the sam- child labor. Older children are more likely to work than pling frame of the 7-17 age group of urban children, 9 per- younger children. Boys are more likely to work overall cent of the children were working full-time. and to work for wages. Girls are more likely to engage in home care work. Overall, the incidence of child labor is higher among older children. Boys are more likely to work · The education and employment of than girls, but are less likely to work in parents are the most important house- home care or to combine work with hold determinants. The more edu- school. The more educated the parent, cated the parents, the less likely their the less likely it is that the child works children are to work. The mother's and the more likely it is that the child employment usually leads to an in- who does work also attends school. The crease in child labor. The child, usu- mother's employment status is also a sig- ally the daughter assumes parenting nificant determinant; children of mothers responsibilities that allow the mother who work are much more likely to com- to work in the labor force. bine work and school than to work full- time. · Having siblings generally reduces the likelihood of child work, but the ef- An unusual dimension of the Bolivian fect of the age and gender of siblings case is the ethnic dimension to child la- is country specific. Even within a bor. Children of indigenous groups are country, the pattern varies between less likely to work full-time or to work urban and rural areas. for wages than are other children. Evi- dence from other sector studies suggest · that indigenous people are excluded from formal sector em- Owning a household enterprise or farm is the most im- ployment; probably true of their children as well. Through- portant economic attribute for the household for deter- out Latin America children of indigenous groups are more mining child labor outcomes. A family enterprise in- than twice as likely to be working than other children. Chil- creases the probability that a child will work and de- dren whose mothers are not in the labor force are more creases the probability that the child will combine work likely to work if they are indigenous. This makes the chil- and school. dren of indigenous groups prime candidates for targeted programs to increase school attendance and decrease child · A household's poverty status exerts an influence beyond labor. the characteristics already controlled for, suggesting that constraints on the poor (to borrow, to insure) increase the Colombia odds of child labor. There is weak evidence that the di- rect monetary costs of schooling (tuition, fees and other Despite legislation making school attendance compulsory charges) and distance to school affect child labor deci- and improvements in enrollment rates over the past several sions. In Bolivia and Colombia, the direct cost of school decades, a large proportion of children do not attend school. has a significant impact on child labor outcomes. Overall, in Colombian metropolitan areas at least 4 percent 2 of children at every age are not going to school and this rate The legislation against child labor needs to be consistent is much higher at very young ages and over the age of 15. with enforcement capacity and should be used initially to There is not much variation across metropolitan areas; the combat the most ethically intolerable forms of child labor real demarcation lies between the urban and rural areas. Re- such as prostitution, bonded labor, or the use of children in gardless of age more girls than boys attend school. Among criminal and military activities. Enforcement should be the rural populations gender differences increase between the responsibility of the police not the inspectors of ministries ages of 12 and 15. Presumably some boys leave school af- or social agencies and should rest with the ministries and ter completing their primary education while girls stay on to agencies to protect working children from hazardous work age 15 to finish the basic cycle. The work school decision is and limitations on hours. more of a trade off for girls than for boys. Girls go to school only or only to work, rarely combining the two. Policies should make it easier for working children to combine work and school. Poor households need the income their The main three sectors employing boys and girls falling un- children generate. Part of this income is often used to meet der the work and school, full-time wage schooling expenses. A combination of work and family enterprise home care restrictions on hours worked and the categories are construction, agriculture creation of flexible school hours so that and services for girls and construction, children can attend school during the agriculture and utilities for boys. In the evenings or during non-peak seasons can lowest income quintile 72 percent of create a transition situation between full- youth ages 14 to 17 work for wages or in time work and no work that may be easier home care while in the highest quintile for parents to acceptthan the no-work 40 percent do so. Few children in the alternative. lowest quintile combine work and school. Their full contribution is crucial in mak- The measures are needed to alleviate the ing ends meet. Forty one percent of chil- income constraints of households with dren in rural areas work versus 16 percent working children through cash or in-kind and 13 percent for urban boys and girls. transfers. Such measures will allow By age 17, 70 percent of rural youth children who work and do not attend work, more than double the share of ur- school to combine the two and ban youth. Child labor contributes an eventually prepare the way for children average of 19 percent of household in- to go to school and not work. Ultimately come in urban areas and 35 percent in ru- the most efficient way to transfer ral areas. resources to households with working children is to make alternative income Policy Recommendations sources available to households. The following actions can help reduce child labor: The study promotes a balanced approach to the elimination · Provide both home business support and enrollment in- of child labor in which legal protections for working centives children are established and enforced and the combination · Target the children of parents with low education of child labor and schooling is made more attractive than · Target locations where child labor is concentrated work alone. Policies can shift children who are both attending school and working toward schooling as their · Target the characteristics of poverty that contribute to primary activity. In contrast to legislative bans on child higher rates of child labor labor, which can jeopardize poor households by removing an important survival strategy, this approach seeks to ******* increase the children's schooling through incentives while buffering poor families. About the Authors Apply a gradual policy approach to the elimination of child labor. A zero tolerance approach would actually harm Harry Anthony Patrinos is a Senior Education Econo- working children because such policies would fail to mist in the Education Sector of the Human Develop- address the root causes of child labor. Child labor exists ment Department of the Latin America and the Carib- because education systems and labor markets do not bean Region of the World Bank. Christiaan N. function properly because poor households cannot insure themselves adequately against income fluctuations and Grootaert is a Consultant currently working with the because perverse incentives exist that create a demand for Social Development Department. child labor. 3 Selected Child Labor Interventions in Latin America Mexico's Progresa While more than 90 percent of rural Mexican children attend primary school, 45 percent dropout after sixth grade when students advance to secondary school. Enrollment also falls after ninth grade when 42 percent of students leave. In 1997, Progresa was introduced in Mexico to encourage enrollment and reduce the dropout rate. Bimonthly checks are sent to rural families; the amount varies from about $10 per month in third grade to $35 for girls in ninth grade. Girls in secondary school are paid 15 percent more than boys because girls have a higher dropout rate. Families are also given a grant to buy school supplies and a monthly food subsidy if they get medical checkups, immunizations and health education lectures. The education grants are substantial, about two-thirds of what secondary students would receive for full-time work. In 2000, some 2.5 million rural families received benefits, about one ninth of all families in Mexico. Progresa increased transitions to secondary school by nearly 20 percent. Educational attainment is projected to increase by two- thirds a year because of Progresa. Larger effects could be expected if the benefits were extended to ninth grade. Child decreased as enrollment increased. Eligibility for Progresa benefits led child employment to decline by about 15 percent. The total cost was around $1 billion, or .0.2 percent of gross domestic product. The new government of Mexican President Vicente Fox recently renamed the Progresa program Oportunidades and plans to expand it to urban areas with the help of a $1 billion loan, the largest ever, from the Inter-American Development Bank. Brazil, Colombia, Guatemala and other countries have introduced similar programs or are in the process of doing so. Guatemala's Eduque a la Niņa One possible strategy for increasing female participation is to reduce the costs for girls using special scholarships only for girls. The scholarship package is one element of the pilot Eduque a la Niņa under the Girls' Education Program of Basic Education Strengthening Project (BEST) in Guatemala. While the pilot also made use of parent committees and community outreach workers, the most innovative tool in the package is a small scholarship --equivalent to US$4.00-- that is provided to girls enrolled in grades one, two and three in 12 rural communities. Brazil's Bolsa Escola Program The Bolsa Escola Program is a poverty-targeted social assistance program that provides cash grants to poor families with school-age children between the ages of seven to fourteen. These programs aim at increasing educational attainment, to reduce current, and future poverty, as well as child labor, and, implicitly, to act as a partial safety net. The rationale for these programs should be considered in the context of the current picture of poverty in the country, where the strongest correlates of current poverty is low education. The program works as an effective preventive intervention not only to child Notes Christiaan Grootaert and Harry Anthony Patrinos. "A Four-Country Comparative Study Of Child Labor". Paper presented at The Economics of Child Labor Conference. Oslo, Norway, May 28-29, 2002 Christiaan Grootaert and Harry Anthony Patrinos, Editors. The Policy Analysis of Child Labor: A Comparative Study. New York: St. Martin's Press, 1999. Alan B. Krueger "Putting Development Dollars to Use, South of the Border" Section: Economic Scene New York Times 2 May 2002. To Subscribe to "en breve" please send an email to Learn more about our work at: "en_breve@worldbank.org" or write to: http://www.worldbank.org/lac Editor, En breve MSN I6-604 The World Bank 1818 H Street NW Washington D.C. 4