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The Impact of a Rise in Expected Income on Child Labor: Evidence From Coca Production in Colombia

Author

Listed:
  • Diego A. Martin

    (Harvard's Growth Lab)

Abstract
Can households' beliefs about future income shocks affect child labor? This paper examines whether the three-year gap between the announcement (in 2014) and the start (in 2017) of the Illicit Crop Substitution Program (ICSP) increased child labor in Colombia. The ICSP provides farmers with financial support for not planting and harvesting coca leaves – the key input of cocaine. My results from a difference-in-differences model using differences in historical coca production show that due to the ICSP announcement, children became four percentage points more likely to work in municipalities with historical coca production than in non–coca-growing areas. Although the likelihood of working increased in coca–growing areas, the hours worked per child declined modestly after the ICSP announcement. The expansion of the children working in coca fields but the decline in working hours per child produce null effects of the announcement on education outcomes. The rise in the expected income affects the time allocation decision within households in rural areas.

Suggested Citation

  • Diego A. Martin, 2023. "The Impact of a Rise in Expected Income on Child Labor: Evidence From Coca Production in Colombia," CID Working Papers 150a, Center for International Development at Harvard University.
    • Handle: RePEc:cid:wpfacu:150a
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    File URL: https://growthlab.cid.harvard.edu/sites/projects.iq.harvard.edu/files/growthlab/files/2023-06-cid-fellows-wp-150-coca-production-child-labor.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Child labor; Coca cultivation; Anticipated effects; Policy announcements;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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