A Heterodox Approach – Western Nations’ use of Child Labour in Developing Countries (30 minute blind essay)

A side effect of technological development and globalisation has been that Western Nations have become increasingly reliant on developing nations for cheap and unrestricted resources, often in the form of child labour. The right for Western nations to take advantage of this resource is questionable. On one hand, it is the responsibility of developed nations to set the example in terms of ethical labour standards, whilst also there are other methods of encouraging growth without the exploitation of child labour. However, one could argue that western nation’s intervention on developing countries is simply another strand of modern day economic colonialism, whilst similarly it would be hypocritical for western nations to impose these productivity shrinking institutions when they themselves developed without them. To me, western nations should refuse to trade with countries that rely on child labour.

Indeed, if the end goal of economics is to promote welfare, then it would be ignorant to promote child labour under the banner of growth economics. It is the moral responsibility of Western Governments to positively influence developing nations, so that they may develop in a sustainable, but ultimately ethical way. If a developing country is able to grow economically, but at the cost of welfare loss through child labouring, then this sets a dangerous precedent for other countries, as a potential route to prosperity. If western nations were to outlaw the import of products involved in the child labour market, then this would set the bar for development economics in terms of ethical institutional standards.

Furthermore, it is clear that child labour is not a necessary requirement for the fostering of growth in developed countries. Paul Collier’s “The Bottom Billion” cited evidence in which institutional development in terms of the furthering of the labour skill set is more advantageous to economic growth than the equivalent expansion of the labour supply, in terms of long term growth patterns. If the revenue from foreign aid and import taxation were to be invested in education and training to expand the labour skill set, then the increased productivity of individuals would reduce the necessity for child labour. Therefore, if western countries refused to trade with slave labouring countries, it may impede short term growth, but in the long term it will catalyse the creation of a more productive labour force.

On the other hand, one could argue that the imposition of Western ideals on developing countries is a form of economic neo-colonialism. Developed countries do not have the right to impose their cultural ideals on developing countries, in order to create a blanket Anglo-American world style of governance. This is especially true when essential short term economic growth is at stake. Western culture and ideals should not intervene and replace developing nation’s traditions, otherwise western nations face repeating imperialist conquests and exacerbating the damage that globalisation has to existing cultures.

What’s more, it would be hypocritical for Western nations to impose their own now developed institutional standards on developing countries, when they themselves did not develop under these restrictive ideals. For instance, as Ha-Joon Chang’s “Kicking Away the Ladder” argues, in terms of “per capita income band”, the UK in 1750 was at a similar level level of economic development as India in 1992. However, in the UK in 1750, there was no male suffrage (1918), established central bank, Income Tax (1842), Modern Patent Law (1852) or Child Labour Regulation (1802). Whereas India, at the same level of economic development, had established all of these institutions over the prior century. Could it be that institutions within developing countries are too advanced for the respective levels of development?

After careful consideration of the arguments, it is clear that Western Nations should not refuse trade with countries who allow slave labour, otherwise the West risks repeating the economic colonialism of the 18th and 19th century. To reject trade on the basis of culture would undermine the developing countries independence, and impede potential development. However, this is not to say that Western countries should prevent efforts from reforming unethical labour institutions. Reformation of immortal labour standards is important for long term institutional development, however, this should not be hypocritically forced upon developing countries who currently rely on a cheap expansive labour force to boost productivity.

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