Analyzing the Effects of Demographic Transition on Child Labor in Developing Economies

Abstract

Purpose: In efforts to realize the dividend of demographic transition, elimination of child labor has become an utmost challenge for the relevant international bodies. Knowing the importance of this issue, children are now the center of the vision of sustainable development as SDG 8.7 and 16.2 are directly related to children and their lives. In this context, the purpose of the current study is to analyze the linkages between demographic variables (such as working-age population, labor force participation rate, labor force growth rate, life expectancy, and dependency ratio and population growth) and child labor along with some other macroeconomic determinants of child labor. Design/Methodology/Approach: A panel of 45 developing countries covering the period 2000 – 2019 is used for empirical analysis. Dynamic panel GMM technique is utilized for empirical results. Findings: The results show that increase in the working-age population, GDP per capita, age dependency old and young, and health expenditures increase the child labor but increase in life expectancy and educational expenditures reduce the child labor in developing countries. Population growth rate reduces child labor in overall developing countries and high-income developing economies but increases child labor in low income developing countries. The increase in labor force growth rate increases child labor in a panel of developing economies and low-income developing economies but reduces child labor in high-income developing economies. Implications/Originality/Value: Public expenditures in health and education along with increasing the female labor force participation rate is recommended to reduce the child labor in developing countries.