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http://hdl.handle.net/10419/67145
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| Title: | | Loan regulation and child labor in rural India  |
| Authors: | | Dasgupta, Basab Zimmermann, Christian |
| Issue Date: | | 2012 |
| Series/Report no.: | | Discussion Paper Series, Forschungsinstitut zur Zukunft der Arbeit 6979 |
| Abstract: | | We study the impact of loan regulation in rural India on child labor with an overlapping-generations model of formal and informal lending, human capital accumulation, adverse selection, and differentiated risk types. Specifically, we build a model economy that replicates the current outcome with a loan rate cap and no lender discrimination by risk using a survey of rural lenders. Households borrow primarily from informal moneylenders and use child labor. Removing the rate cap and allowing lender discrimination markedly increases capital use, eliminates child labor, and improves welfare of all household types. |
| Subjects: | | child labor India informal lending lending discrimination interest rate caps |
| JEL: | | O16 O17 E26 |
| Document Type: | | Working Paper |
| Appears in Collections: | | IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)
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