So it’s come out that Victoria’s Secret has been purchasing cotton for its popular lingerie from a Burkina Faso plantation in West Africa that employs forced child labor. Forced labor is slavery, and not at all acceptable. However, I wanted to take the opportunity point out that child labor isn’t inherently evil, as it is always depicted in the popular media, history books, and lecture halls.
Firms that do employ child labor, where the children aren’t held as slaves, are one of the greatest benefactors of the children and their families. Were it not for the opportunity to work in a factory or on a farm there are few alternatives for the people of so many developing nations. The mere threat of a U.S. trade deal that was supposed to ban exchange with countries that permitted child labor was enough to force tens of thousands of children out of factories and into the streets. Many of those children ended up in the [trade]. Hardly a better life, as one could imagine.
Prior to the industrial revolution children in virtually every country worked in agriculture. The alternative was for them and their families to starve. As capital was invested and production became mechanized the children were able to move into the cities where they worked in factories. The conditions would be abominable by today’s standards but they were at least better than the alternative of the day.
Only the advent of the industrial economy allowed parents of these children to earn enough that they could take them out of the factories. If helping the children of these countries is truly the goal then taking their jobs will hardly be effective in that endeavor. As Ben Powell explains:
Wages are low in the third world because worker productivity is low (upper bound) and workers’ alternatives are lousy (lower bound). To get sustained improvements in overall compensation, policies must raise worker productivity and/or increase alternatives available to workers. Policies that try to raise compensation but fail to move these two bounds risk raising compensation above a worker’s upper bound resulting in his losing his job and moving to a less-desirable alternative.
Again, I do not believe that impressing children into manual labor is good for them or morally acceptable. I do however take issue with well-intentioned news reporters who make knee-jerk assumptions that all we need is more government to solve every problem. Henry Hazlitt said of the good economist that he must “[look] not merely at the immediate but at the longer effects of any act or policy; [and trace] the consequences of that policy not merely for one group but for all groups.” Perhaps the news anchor should pick up a copy of Economics in One Lesson. It’s free, here.
