Local labor demand and child work

This chapter uses micro data from the Brazilian Pesquisa Nacional Por Amostra de Domicílios (PNAD) between 1981 and 2002 to ascertain the role that local labor demand – proxied by male adult employment in the area of residence – plays in shaping the work and schooling decisions of children aged 10–15 years. We find that child work is on average procyclical, while school enrollment is essentially unaffected by local labor market conditions: As local labor demand conditions improve, children are more likely to combine work with school and are less likely to be inactive. One exception is young urban boys with older brothers: These children experience a fall in employment when local labor demand is stronger. This result is consistent with older children subsidizing younger siblings’ schooling and play time.