Child labor in debt bondage : an empirical analysis of the impacts and policies

Abstract

Modern forms of slavery are emerging as a new phenomenon in modern economies. Although slavery is legally banned in all countries, it is still present everywhere. Modern slavery actually takes many forms, one of which is debt bondage (or bonded labor). Mostly found in agrarian economies, bonded labor constrains poor workers to work for an indefinite period of time in reimbursement of a debt. That debt is often contracted from a private moneylender, generally the landlord. Profiting from their inability to bargain, the landlord remunerates the indebted laborers with low wages, thus imprisoning them in a long cycle of slavery work. When workers find themselves held in debt bondage, they put their families to work in an attempt to reimburse their debt faster. As a consequence, millions of children today are victims of labor in debt bondage. Bonded labor unsurprisingly results in consequences on children’s lives. This thesis attempts to answer the question of how dramatic the effects of debt bondage can be, particularly with respect to two fields: the education enrollment of working children and the fertility rate of working households. In a second instance, the thesis investigates how effective is the rural-urban migration policy in delivering children from the threat of debt bondage. The importance of raising these questions derives from the fact that for the issue of child labor in debt bondage to be properly addressed, it first needs to be accurately assessed. So far, extensive data on the topic does not exist. The literature is still mostly constituted of theoretical models. Thus, presenting a quantitative assessment and identifying some of the correlates of child work in debt bondage should help propose instruments that could be used in the improvement of anti-bonded labor policies. This contribution comes with the wider aim of helping to fight a human and moral problem of modern times.