Child Labor and Schooling Responses to Access to Microcredit in Rural Bangladesh

16 Pages Posted: 30 Nov 2012

See all articles by Asad Islam

Asad Islam

Monash University - Department of Economics

Chongwoo Choe

Monash University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: January 2013

Abstract

Microcredit has been shown to be effective in reducing poverty in many developing countries. However, less is known about its effect on human capital formation. In this article, we examine the impact of access to microcredit on children's education and child labor using a new and large data set from rural Bangladesh. The results show that household participation in a microcredit program may increase child labor and reduce school enrollment. The adverse effects are more pronounced for girls than boys. Younger children are more adversely affected than their older siblings and the children of poorer and less educated households are affected most adversely. Our findings remain robust to different specifications and methods, and when corrected for various sources of selection bias.

JEL Classification: H43, I21, J13, J24, L30, O12

Suggested Citation

Islam, Asadul and Choe, Chongwoo, Child Labor and Schooling Responses to Access to Microcredit in Rural Bangladesh (January 2013). Economic Inquiry, Vol. 51, Issue 1, pp. 46-61, 2013, Available at SSRN: https://ssrn.com/abstract=2182971 or http://dx.doi.org/10.1111/j.1465-7295.2011.00400.x

Asadul Islam

Monash University - Department of Economics ( email )

Department of Economics
Monash University
Caulfield East, Victoria
Australia
+61399032783 (Phone)

HOME PAGE: http://users.monash.edu/~asaduli/

Chongwoo Choe

Monash University - Department of Economics ( email )

Department of Economics
PO Box 197
Caulfield East, Victoria 3145
Australia
+61 2 9903 1125 (Phone)
+61 2 9903 1128 (Fax)

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