ABSTRACT
This chapter reviews available theoretical and empirical literature to assess the scope, intensity, trends and strategies adopted to combat child labour. It pays particular attention to poverty and role of education, supply and demand and impact of trade liberalisation to obtain a clearer understanding of the nature of the problem. It reviews existing literature on child labor, identifies the most important determinants of child labor. It evaluates the welfare implications and evaluates policies that will help minimize the severity of the problem in developing countries. The chapter shows parents are fully altruistic to their children, child labour can be Pareto inefficient. Labour market dysfunction model (LMDM) model considers child labor as a problem created due to LMDM. It posits that parents uncoordinated decisions to send children to work increases the supply of labor and hence low wages which in turn perpetuate poverty. Credit constraint model (CCM) suggests that child labor causes poverty.
