From Malthus to modern growth: child labor, schooling and human capital

This paper develops a dynamic general equilibrium model of fertility, human capital accumulation,child labor and uncertain child survival focusing on the qualitative and quantitative effect of decliningmortality on household decisions and economic development. Due to uncertainty about child survival,parents have a precautionary demand for children. Rising survival probability leads to falling fertility,eventually to investment into schooling and the demise of child labor. Child labor can be an obstacleto development since it lowers the incentives of parents to educate children. Furthermore, the paperargues that the decline of precautionary child demand as a consequence of falling mortality is notsufficient to generate a demographic transition. Falling mortality can only explain a relatively smallpart of the fertility decline. A sizable reduction in fertility can only be achieved by human capitalinvestment and the induced quantity-quality trade off.     «

This paper develops a dynamic general equilibrium model of fertility, human capital accumulation,child labor and uncertain child survival focusing on the qualitative and quantitative effect of decliningmortality on household decisions and economic development. Due to uncertainty about child survival,parents have a precautionary demand for children. Rising survival probability leads to falling fertility,eventually to investment into schooling and the demise of child labor. Child labor can be an o...     »