children's labor force participation in the world system

Children's Labor Force Participation in the World SystemAuthor(s): CYNTHIA K. DRENOVSKYSource: Journal of Comparative Family Studies, Vol. 23, No. 2 (SUMMER 1992), pp. 183-195Published by: Dr. George KurianStable URL: http://www.jstor.org/stable/41602210 .

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Children's Labor Force Participation in the World System*

CYNTHIA K. DRENOVSKY"

INTRODUCTION

Compared to the role of children in economically developed and industrialized countries, the role of children in developing countries is relatively unclear. In many developing countries, children and children's labor contribute to family income. However, because the prevailing ethos in the world is dominated by Western principles and international organizations exist that are designed to regulate child labor and protect children from exploitation, an accurate depiction of the contribution of children's labor is not easily discernable.

This study explores the extent to which the domination of developed countries in the world system influences child labor in developing countries. The impact of conditions of development on child labor within countries is also investigated.

The Nature of Child Labor In most developing countries children continue to play significant economic roles

(Bouhdiba, 1982; Rodgers and Standing, 1981, Hout, 1980, Mendelievich, 1979). These children may be employed in the informal labor market such as farm work or family business (Dixon, 1982; Cain, 1977; Mendelievich, 1979; Ennew and Young, 1981), in the formal labor sector (Bouhdiba, 1982; Rodgers and Standing, 1981) or in markets that are illegal, such as prostitution (Bouhdida, 1982).

One of the key factors suggested as affecting children's economic activity in any society is poverty (Rodgers and Standing, 1981; Blumberg, 1976). In environments under severe economic strain children may be forced to work for the family's survival. Children contribute to the income generating activities of agricultural families, especially if the cost of hiring labor is high (Cain, 1977) and they may also participate in nonagricultural wage employment in order to bring additional income to the farm household.

When urbanization occurs, poor rural families tend to move to urban areas, only to discover employment is difficult to find. Children in jobless families go out to work, and in desperation they take work they can find. This may include cleaning shoes, guarding parked cars, carrying messages or peddling goods (Ennew and Young, 1981 ; Mendelievich,

*An earlier version of this paper was presented at the Annual Meeting of the National Council on Family Relations, Nov. 10-14, 1990, Seattle, WA. "Department of Sociology, Shippensburg University, Shippensburg, Pennsylvania 17257-2210, U.S.A. Vol. XXIII, No. 2 (Summer 1992)



1 84 Journal of Comparative Family Studies

1979). Both family farm labor and informal sector labor in urban settings are not recognized by the International Labor Office (ILO) as part of national labor statistics.

Most children who are formally and legally employed are wage laborers in the service sector (as domestic servants or in restaurants and shops), or in manufacturing and handicrafts (Mendelievich, 1979; Ennew and Young, 198 1). Children are valuable workers in the carpet industry throughout Africa and Asia and in the glasswork industry in Southeast Asia (Mendelievich, 1979). They are often employed in the textiles industry (winding, carding wool, spinning or weaving), in the leather goods industry (cutting, sewing and embroidering) and in the pottery and woodwork industry (firing, modeling or painting) (Mendelievich, 1979).

Child labor is frequently discussed as a social problem that must be addressed and solved in order to protect the welfare of children and safeguard the employment of adults (Mendelievich, 1979; Bouhdiba, 1982). Socioeconomic development is often cited as the primary force necessary for declines in child labor (Mendelievich, 1979). In this study, the importance of socioeconomic development to declines in child labor is not disputed. However, this research proposes that it is urbanization in developing countries and dependency on the more developed countries that affects levels of child labor.

This research also explores the link between women's roles and children's roles by testing the relationship between women's labor force participation and children's labor force participation.

DEPENDENCY THEORY

The search for a more adequate explanation of the conditions leading to children's economic activity must consider the nature of the world system. As articulated by Andre Gunder Frank (1966), the condition that exist in the Third World are not a consequence of these countries' intra-relationships among economic and social variables. Instead, stagnated development or "underdevelopment" is a consequence of a country's economic dependence on developed countries. Furthermore, developing countries cannot mature as developed nations due to the exploitative nature of relationships between developing and developed countries. These observations by Frank and others during the 1950's and 1960's (See Chirot and Hall, 1982, for a review of these positions) were to become the theoretical underpinnings of what is today called dependency theory.

Dependency theory posits that industrial nations controls capital and technology in the world market. This produces an international division of labor that puts underdeveloped nations at a disadvantage because of their reliance on the devolved nations for goods and income (Wallerstein, 1974). The industrial, economically developed nations' structural position places them at the center or "core" of the world system (Wallerstein, 1974). The core nations have technologically progressive agriculture, skilled and relatively well paid labor, and high capital investment (Chirot and Hall, 1982). Households are not the units of production in these economically advanced countries and wages are high enough to allow adults to provide subsistence for their families without help from children.



Children' s Labor Force Participation in the World System 185

In order to expand economically, the core countries extract surplus or profit from underdeveloped countries in the periphery. The countries in the periphery are in the structural position that makes them vulnerable to exploitation and the expansion of the core countries (Chirot and Hall, 1982). In the peripheries the labor force is predominantly unskilled, producing key primary goods and raw materials that benefit the core. Quite often piecework (for the manufacturing of electronics or textiles, for example) is shipped to the peripheries.5This cheap labor is usually performed by women (Ward, 1984) and children (Bouhdiba, 1982). The unfinished products are shipped back to the core where they are finished (Ward, 1984). Because there is a greater supply of labor in peripheral countries than is generally needed and peripheral countries need the manufactured goods produced by the core countries, the periphery becomes increasingly dependent on the core countries (Wallerstein, 1974).

A third structural position, the semiperiphery , represents a group of countries that stand between the core and the periphery (Wallerstein, 1974). These countries appear to be more developed because of their well-organized labor force and economic power. They are, nevertheless, dependent upon the core. The semiperipheral countries contribute to the stability of the world economy because they reduce the polarization of the world system (Wallerstein, 1974b). The semiperiphery plays an intermediate role, exploited by the core and exploiting the periphery (Nemith and Smith, 1985).

Transnational corporate penetration into the periphery is a form of foreign investment that perpetuates the core-periphery dependency relationship (Bornschier and Chase-Dunn, 1985) as well as undesirable conditions of "overurbanization" (Timberlake and Kentor, 1983). Transnational corporations are able to control labor markets and create dependency via import substitution and export processing (Ward, 1984). Import substitution occurs when the transnational corporation brings capital-intensive technology into the periphery, thereby limiting the availability of jobs in urban areas (the jobs that are available require advanced skills in order to use technologically advanced machinery) and displacing workers. The displaced workers end up seeking employment in the informal or service sector (Evans and Timberlake, 1980). Export processing is the phenomenon of factories owned by the transnational corporations in the periphery that process goods for export only. This may produce many jobs for unskilled workers, however they tend to be low paying and subject to the vicissitudes of economic trends in the international economy i.e., layoffs and unemployment (Ward, 1984).

Commodity concentration further exacerbates the conditions of dependency brought on by trade dependency and transnational corporate penetration. Commodity concentration occurs when peripheral countries are encouraged to trade or produce for export only one or two commodities (Ward, 1984). When a country is capable of producing and exporting a variety of products, their market for trade becomes diverse. When a country's exports are concentrated on one or two products, that country can only trade with other countries that are willing to trade for those commodities. However, the peripheral countries that can only export one or two products also need to import a variety of products. Thus commodity concentration produces conditions where the periphery is dependent on the core for a variety of products but can only offer one or two products in trade.




The Effects of Urbanization and Dependency on Children The exploitative nature of the international system places women and children living

in peripheral countries at a specific disadvantage. As the household ceases to be the unit of production, women are forced out of the productive agricultural roles they occupied before industrialization. Men have easier access to technology and education and are thus able to transfer their economic activities outside the home while women and children become dependent upon husbands and fathers for income. If women do participate in the labor force, they tend to be restricted to low priority, low wage jobs in the service sector (Mascia- Lees, 1984; Ward, 1984).

Under circumstances of financial strain, children may have to work in order for a family to survive. It is important to note that children typically are paid less than adults who hold the same jobs (Bouhdiba, 1982). Employers may encourage child labor in order to maintain low wages for the labor force (Rodgers and Standing, 1981a, Mendelievich, 1979). It is not clear in the literature whether children are employed directly by transnational corporations in low wage jobs. However, multi-national manufacturing industries have been able to take advantage of child labor indirectly (in the ancillary industries) while maintaining a well paid and organized labor force in the "mother company" (Goddard and White, 1982). It is often noted that when children work in order to contribute to a poor family's earnings, they are actually contributing to the maintenance of low wages in the labor force (Mendelievich, 1979; Bouhdiba, 1982; Rodgers and Standing, 1981). In peripheral countries, low wages are essential to the effectiveness of the core's expansion and the periphery's dependency (Chirot and Hall, 1982).

When a country experiences rapid urbanization both women and children loose their agricultural work roles and seek employment in cities. The most desirable scenario would be for children to seek education in order to acquire the skills necessary for adult employment. However, in the rapidly urbanizing periphery, this is not possible both because children's income is needed by the household and because schooling may not be available to the child. It is hypothesized in this study that rapid urbanization and dependence on foreign investment and trade will increase the likelihood that children will work. It is also hypothesized that when women work children also work because they are working in the same settings and there are no alternatives settings (such as schools, child care) to place children.

PROPOSED MODEL

The effects of foreign in vestment and trade dependency on the employ ment of children in low/semi skilled jobs and jobs in the service sector has not been examined empirically. However, based on ILO and field study information about the wage minimization function of children's labor and the descriptions of the type of labor that children typically perform, it is inferred here that children are economically active because their labor is needed and they are cheaper to employ than adults. It is therefore hypothesized that:

Hypothesis 1: There is a positive relationship between dependency in the form of commodity concentration and the proportion of children in the labor force.




Hypothesis 2: The greater the penetration of multi-national corporations into a country, the higher the proportion of children in the labor force.

Because urbanization in developing countries is linked to tertiary and service sector growth and because these jobs attract children it is hypothesized that:

Hypothesis 3: The greater the growth of the urban population of a developing country, the higher the proportion of children in the labor force.

And finally, because women's wages tend to be low and supplemental income may be necessary and because women have few alternatives for child care it is hypothesized that:

Hypothesis 4: The higher the proportion of women in the labor force, the higher the proportion of children in the labor force.

THE STUDY

The Sample The sample consists of 70 developed and underdeveloped countries for which there is

published data on the independent, dependent and control variables. Measures of children's labor force participation are published yearly by the in International Labor Office. However, many countries do not report children's economic activity rates to the Interna- tional Labor Office, or the data is not available for publication. Therefore, missing data is

problematic in cross-national studies on children's labor force participation. The Interna- tional Labor Office published a Special Table in the 1978 Yearbook of Labor Statistics

(International Labor Office, 1978) that contains mid-decade estimates for participation rates, by sex and age groups for all countries. This is the most current and complete source of cross-national data on children's economic activity and it is used in this study.

Countries with populations smaller than one million are eliminated from the sample in order to increase comparability among nations (Caldwell et al., 1980). Also, countries that do not report trade or foreign investment statistics are not included in the sample. For

example, economic world system data (commodity concentration and multi-national

corporation penetration) are not available for most state controlled or centrally planned economies such as Bulgaria, Romania, Poland and the U.S.S.R. These countries are

therefore, excluded from the present analyses (see appendix for a complete list of the

sample countries).

Independent Variables

Foreign investment and international trade based measures are the most frequently used indicators of dependency (Delacroix and Ragin, 1981). Dependency status will be



188 Journal of Comparative Family Studies

represented by two separate measures that indicate trade dependency and foreign investment. The measures are commodity concentration in exports in 1970 and multi-national corporation penetration in 1973.

Commodity concentration is the value of a nation's most important export commodity, as a percentage of its total exports (Ballmer-Cao, et al., 1979). A commodity concentration value of 30 for example, means that 30% of a country's exports consist of the one most important export product (See Ballmer-Cao, et al., 1979 for computational information). Commodity concentration represents the international division of labor (Delacroix and Ragin, 1981). This measure also indicates the core's trade advantage over the periphery. The periphery, rather than diversifying, produces one or two commodities for export, thereby maintaining its dependency on other countries for a variety of products (Ward, 1984). The core further encourages this commodity concentration by supplying the periphery with the finished products they need.

Multi-national corporation penetration is based on the stock of foreign direct investment in relation to total energy consumption and population (Ballmer-Cao, et al., 1979). The total stock of foreign direct investment refers to the net book value to the direct investor affiliates (subsidiaries, branches and associates) in a host country (See Ballmer-Cao, et al., 1973 for computational information). These dependency data are compiled from the Compendium of Data for World System Analyses (Ballmer-Cao, et al., 1979) which is a data source book of internationally comparable statistical information for the purpose of cross national research.

Urban population growth is indicated by the average annual growth rate of the percent of total population that is urban from 1970-1975. This measure is recorded from the 1979 World Development Report (World Bank, 1979). The growth rates of urban population are calculated from the World Bank's population projections and estimates of urban population shares from the UN population division (World Bank, 1979). Not all countries have the same definition of "urban"; therefore the World Bank urges caution in comparing these measures across countries (World Bank, 1979).

Women's labor participation is measured by the proportion of females in the labor force and it is recorded from the Yearbook of Labor Statistics 1978 Special Table (Interna- tional Labor Office, 1978) that shows mid-decade estimates for participation rates, by sex and age groups for all countries, regions and major areas of the world.

The International Labor Office (1978) has suggested caution in comparing labor data across countries because of differences in data collection, classification and tabulation of data. In some countries, for example, family workers are recognized and tabulated and in other countries they are not. It should be remembered that the hypotheses tested here are concerned with formal labor activities. Certainly, better measurement of unpaid labor and informal labor could add credibility to the theory proposed, but the measurement issues that need to be addressed in order ,to include these categories have not been developed and would require access to data not currently available.



Children s Labor Force Participation in the World System 1 89

Dependent Variable Child labor is measured by the proportion of children (workers under the age of 15) in

the labor force. These data are drawn from the Yearbook of Labor Statistics 1978 Special Table (International Labor Office, 1978) that shows mid- decade estimates for participation rates, by sex and age groups for all countries, regions and major areas of the wořld.1

Thé International Labor Office urges caution when interpreting crude economic activity rates (i.e. the ratios of the total economically active population to the total population of all ages) reported in the Yearbook of Labor Statistics because the sex-age structure of a population will influence crude activity rates. In countries that have a high proportion of children, it will appear as if they have a high proportion of child labor compared to other age groups. To account for this problem in the present analysis, the activity rate used is actually the ratio of the total economically active population of children to the total population of children (not of all ages).

Control Variables Gross national product is often used as a measure of societal wealth or economic and

social development (Barnett, 1989; Todaro, 1985). Gross national product measures the total domestic and foreign output claimed by residents (World Bank, 1978). A major problem with using GNP as a measure of socioeconomic development is that it does not include non-marketed subsistence production such as family farm labor or production from the informal labor market. Also, GNP figures give no indication of how income is distributed in a country (Todaro, 1985). The log of GNP will be used in order to adjust for its highly skewed distribution in the world system. Per capita GNP figures (from 1975) will be recorded from the World Bank Atlas (1977). The World Bank Atlas (1977) provides estimates of population, gross national product, per capita GNP for most countries in the world in 1975.

The size of the labor force is also controlled by including the proportion of the population that is economically active. This measure is taken from the Yearbook of Labor Statistics 1978 Special Table .

RESULTS

Descriptive Statistics Table 1 displays the means and ranges of the independent and dependent variables

proposed in the model (N=70).

The range of observed dependency measures was fairly wide. For example, commodity concentration ranges from 8.4 to 98.7 and the range of multi-national corporation

4n 1973 the ILO set forth standards suggesting that individuals under the age of 15 should not be eligible for employment. To date, almost all countries have an institutionalized age below which child labor is illegal. However, the national minimum age varies from 12 (Egypt, India, Indonesia) to 18 (Afghanistan) (Bouhdiba, 1982). According to Mendelievich (1979), the national minimum age for employment may be low in countries where children's labor is particularly profitable.




Table 1 MEANS AND RANGES OF INDEPENDENT AND DEPENDENT VARIABLES

Variable Mean Range Standard deviation

Dependency (cc) 39.9 8.4 - 98.7 21.8 Dependency (mcp) 72.5 1.5 - 174.7 53.0 Urban Growth 4.2 .4 - 18.4 3.1 Female Labor 37.2 3.1 - 84.1 19.0 Child Labor 3.9 .1 - 12.0 3.2 GNP 1776.2 90.0 - 8410.0 2351.7 Log GNP 6.6 4.5 - 9.0 1.4 * Independent and dependent cc = commodity concentration variables are from 1 970- 1 975 mcp = multi-national corporation N=70 penetration

penetration is 1.5 to 174.7. Standard deviations further reflect the dispersion of the values of these variables in the world system (commodity concentration standard deviation is 21 .8 and multi-national corporation penetration standard deviation is 53 .0). The range of female labor force participation is also wide (3. 1 to 84. 1) while children's labor force participation has a much narrower range (.1 to 12.0). GNP measures perhaps best illustrate the variation and distribution in the world system which is why the measure has been transformed to the log of GNP.2

The proportion of the population that is urban increased by 4.2 percent from 1970 to 1975. Most of this growth occurred in less developed countries. According to the World Development Report (World Bank, 1979), both low and middle income countries had growth rates of 4.2 percent while industrialized countries had an urban growth rate of 1.4 percent and centrally planned economies had an urban growth rate of 2.7 percent

Multiple Regression Results A multiple regression analysis was used to determine the effects of the independent

variables on child labor. Table 2 presents the regression analysis results for child labor.

Hypotheses 1 , and 2 are not supported. The two measures of economic dependency are not significantly related to child labor. However, log GNP, the control for development, is significantly related to child labor (pc.001). As GNP increases, child labor decreases quite substantially (standardized beta= - .6580). Hypothesis 3 and Hypothesis 4 are supported. Hypothesis 3 predicted a positive relátionship between urban growth and child labor. As indicated in Table 2, urban growth is significantly related to child labor (p<.01). This finding is consistent with historical accounts of child labor during urbanization in Europe and the United States (Rodgers and Standing, 1981).

JIn addition to GNP, the distribution of òhild labor is not normal (range=. 1 - 12.0, x=3.87and s.d.=3.24). However, a square root transformation on this variable did not influence the regression results. For the sake of parsimony, the regression results including the transfoimed dependent variable are not presented.



Children ' s Labor Force Participation in the World System 191

Table 2 REGRESSION ANALYSIS FOR CHILD LABOR

Variable Beta Standardized beta

Dependency (cc) - 0.0034 - 0.0227 Dependency (mcp) 0.0027 0.0434 Urban Growth 0.2023** 0. 1902** Female Labor 0.0574*** 0.3369*** Log GNP - 1.5375*** -0.6580***

R2 .81

*p<.05 cc= commodity concentration "p<.01 *"p<.001 mcp= multi-national corporation N=70 penetration

Children often work in horticultural or small scale agricultural settings with' their mothers (Blumberg, 1976). In this study the effect of female labor on child labor was investigated. Hypothesis 4 predicted a positive relationship between female labor and child labor under the aforementioned controls. Children often may work because their mothers are working and they need to work in the same setting because of child care needs. Inter- estingly, this trend is noted in historical accounts of industrialization in the Southern United States (Kemp, 1986). Kemp (1986) notes that in factories mothers could watch children while both mother and child worked. Also, young children could work and take care of infants while the mother worked in the same setting.

DISCUSSION

In summary, this study found that urban growth and female labor force participation positively affect child labor force participation. Dependency, indicated by commodity concentration and multi-national corporation penetration, had no direct effects on child labor force participation.

Case studies of child labor in specific countries have alluded to the dependency status of countries in the world system. For example, in a study of unpaid child labor in Kaolack, Senegal, Alain Morice (1982) predicts that child labor will continue in this region as long as France, the former colonial power, continues to assign Senegal the role of supplier of groundnuts (the industry where these children are employed). Morice also states that, "Given the framework of the present international division of labor, the problem seems to apply equally to many other countries whose specific socioeconomic systems differ from that of Senegal." (Morice, 1982; p. 526). Similarly, Goddard and White (1982) note that child labor is unlikely to "disappear" in Third World countries as it did in the developed countries of the West because of this international division of labor.

To date, no quantitative cross-national studies exist that investigate the effects of



192 Journal of Comparative Family Studies

dependency on child labor. In this study, the international division of labor in the world system, namely conditions of economic dependence, showed no significant effect on the incidence of child labor. In light of these findings, the application of world system variables such as commodity concentration and multi-national corporation penetration as direct influences on children's roles should be reconsidered. The results of this study show that it is not dependence that influences child labor, but urbanization. It is possible, however, that dependency may actually have indirect effects on children through its effects on urbanization. Previous studies have found that the core's dominance over the periphery is associated with an expansion of the tertiary labor force (Evans and Timberlake, 1980) and overurbanization (Timberlake and Kentor, 1983) in the periphery. Children's labor is needed and available in the urban sector and children often find work in the tertiary sector (Mendelievich, 1979; Scott, 1982). The effects of dependency then, may be more indirect than direct with dependency creating the conditions under which children become economically active. The significant effect of urbanization on child labor found in this study suggests that the indirect effect of dependency on child labor should be investigated in future research.

It was found in this study that urban growth significantly affects child labor. This finding is consistent with historical accounts of child labor during urbanization and industrialization in the west (Rodgers and Standing, 1981). This research was guided by the assumption that in the periphery urbanization and industrialization will not be followed by socioeconomic development and declines in child labor as occurred in Western Europe and the United States. Children work in the urban industrial sector because their labor is appealing to employers. For example, children do not demand contracts (or other, employee amenities that adults workers require) or high wages and their labor is flexible (Goddard and White, 1982). It is expected that the child labor market will remain large in the urban centers until significant socio-economic development (that increases quality of life) occurs.

It was also found that as the proportion of women in the labor force increases, the proportion of children in the labor force increases. While it was found that children work as a result of the conditions of urbanization, the determinants of female labor were not identified in this study. As mentioned earlier, and as reflected in the significance of female labor on child labor, children may be working because their mothers are working. Levels of household poverty or a lack of alternatives for children (i.e. schooling) not included in this study may be important control variables that could influence the positive relationship between female labor and child labor. It must be remembered that women work in all types of societies, in rural agricultural settings, in industrial settings in developing countries and in professional and service occupations in developed societies. Because the effects of urbanization, dependency and GNP are controlled for in this study, we can conclude labor activities of women, regardless of urban growth, dependency and GNP will influence whether their children will work. Women's position and roles in society then, influence children's status and roles.

Dependency, as it was mçasured here, may have more indirect influences in women and children. Future studies should examine the direct effects of multi-national corporation penetration and commodity concentration on employment in specific sectors of the labor




force and on rapid urbanization. It is expected that dependency will have more indirect effects on women and children as it operates through labor force opportunities and urbanization. It is also possible that dependency on the core may produce more positive outcomes for children. Multinational corporation penetration for example, creates jobs, or may introduce ideas and opportunities for education for children. The case analysis may help us identify specific situations when dependency is positive and whether it is likely that the positive outcomes will be permanent.

Finally, important information regarding the effect of urbanization on children's economic activity was found in this study. It is believed that the impact of urbanization on children's labor force participation is even greater than reported here because of the frequency of children reported in informal labor in case reports. Better measures of informal and casual labor force participation are needed in order for us to gain an accurate understanding of children's labor force participation in the world system.

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APPENDIX

SAMPLE OF COUNTRIES

AFRICA Algeria Benin Cameroon Ivory Coast Egypt Ethiopia Ghana Liberia Madagascar Malawi Morocco Mauritania Mali Niger Nigeria Rwanda Senegal Sierra Leone Somalia S. Africa Sudan Tanzania Chad Togo Tunisia Zambia

ASIA Burma India Indonesia Israel Japan S. Korea Laos Malaysia Pakistan Philippines Sri Lanka Syria Thailand

LATIN AMERICA Argentina Brazil Columbia Costa Rica Chile El Salvador Guatemala Honduras Nicaragua Trinidad and Tobago Uruguay Venezuela

N. AMERICA, EUROPE, OCEANIA Canada United States Austria Belgium Denmark Spain Finland France W. Germany Greece Ireland Italy Netherlands Portugal Switzerland Sweden Turkey Yogoslavia Australia



children's labor force participation in the world system

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