A typical argument against the participation of young individuals in the labor market goes like this: Child labor deprives children of their childhood, their potential, and their dignity. It harms children mentally, physically, socially, and morally. It interferes with their schooling, preventing them from attending or concentrating in school. In the most serious cases, it may involve children being separated from their families, exposed to serious hazards, or enslaved.
Now, the flaw in this sort of argument is that it tends to equate all paid employment of young individuals with coercion, exploitation, and psychic loss, without admitting any possible gains from employment for the child. This argument also tends to replace the value judgments of the anti-child-labor activist with those of the child and his or her parents.
We can, in fact, see things more clearly when we go back to the fundamentals of praxeology to understand why an individual—child or adult—will choose to engage in paid employment in the first place. Why does an individual prefer work to leisure at any given time? From a praxeological viewpoint, an individual undertakes a paid task because he values the satisfaction to be attained by means of proceeds from paid work, over competing alternatives.
Recall the fundamental conception of action as exchange of a satisfactory future state for a present state of uneasiness. Individuals act in the present in order to remove uneasiness and improve their well-being in the future. Understanding this motive of action helps us grasp why a youngster would, at certain points in time, prefer paid work over the consumption of first order goods like leisure or games with friends.
It is not always the case that the trade-off facing the child is such between working to earn a living and attaining an education. In some parts of Africa, where the market for domestic services includes a lot of young people willing to sell their labor services to wealthier citizens, it is often observed that part of the conditions of the employment contract oblige the employer to pay for the primary and secondary school education of the child in addition to the contracted monthly wage made to the child. To the child and his parents who are not able to afford both his upkeep and education, this is a win. But with the state’s prohibition of such contractual agreements between the child and his potential employers, the child is prevented from enjoying these gains from employment.
As is the case with every other human adult seeking to improve his material conditions by purposeful action, a child expects that integrating himself into the social division of labor would better his future welfare. And, as long as he is not being coerced or held in forced servitude, his psychic gains tend to be maximized by his purposeful actions.
More so, it is not always the case that engaging in paid work negatively impacts the mental health of the child. On the contrary, by working to earn a monetary reward, he gradually develops better self-esteem, a sense of responsibility, economic independence, and psychological maturity at an earlier age.
“Minors” Are Individuals with Unique Needs
The law attempts to broadly define what a “minor” is in order to create an abstract category to which specific legislations can be applied. It starts by defining the concept in terms of age limits. While this may be convenient for legislative purposes, it tends to hide the various differences among individuals within the age limit established as “minor” by statutory law.
The broad category—“minor”—as employed in child labor laws overlooks the individuality of every child. Each minor is an individual with a unique physiological constitution, aptitude, personality, maturity, and intelligence level. All children are not equal in strength and capabilities. However, the law treats both a three year old and a seventeen year old as “minors,” and so equally restrict both from obtaining gainful employment. Forbidding every individual within the “minor” category from undertaking certain lines of productive work because the lawmaker considers them too complex or physically challenging for the young ignores the fact of differences in the physiological, intellectual, and psychological makeup of individuals.
All minors do not also face the same economic realities, and so, do not share the same value scales. One child may be born into a high-income household, another a low-income household. This implies different welfare conditions warranting different value scales. Whereas parents in the high-income group can afford to bear the economic burden that follows from their child’s dependence due to his exclusion from the labor market, the case is different for youngsters born into low-income households. Here, dire economic conditions make it imperative for the child to seek paid employment. Nevertheless, child labor laws do not account for these consequential economic realities.
The methodological individualism of praxeology helps to highlight the hidden costs of statutory laws. Accordingly, it looks at government intervention from the standpoint of its implications for acting men—individuals—as opposed to such abstraction as “minor.”
Economic Effects of Child Labor Laws
The economist investigates the impact of intervention on the material well-being of living, acting individuals. He sees statutory laws restricting action as highly consequential for acting men. Thus, child labor laws are for the economist a frustration of the plans and actions of some individuals intent on satisfying their most urgent wants by means of integrating themselves into the social division of labor.
From the broader perspective of demand and supply, child labor laws are a restriction on the supply of labor in the labor market. As with every restriction of supply, the economic outcome is the emergence of higher prices, in this case, higher wage rates for labor. More particularly, child labor laws lead to the emergence of “restrictionist” wage rates that favor adult members of the labor force while economically injuring younger individuals whose participation in the labor market are coercively excluded by the law.
Restricting the participation of a proportion of the country’s labor force in the labor market leads to a less competitive labor market that results in an increase in the costs of production. A further implication of this is a fall in productivity and standard of living.
Child labor laws also bring about the compulsory unemployment of a section of the labor force who are willing to exchange their labor services for pay. It is often ironic that the same group of people campaigning against unemployment are often among those advocating for the enactment of child labor laws which result in compulsory unemployment of a section of the labor force.
Furthermore, the enforcement of child labor legislation requires the diversion of scarce resources, including withdrawal and reallocation of capital goods from present employment in value-productive lines. The extra costs of maintaining the government agencies entrusted with the enforcement of this legislation implies additional fiscal burden. This is usually transferred to the individual taxpayers who will have to forgo the want-satisfaction because it is taxed away from them.
Natural Law vs. Statutory Law
The social order of the libertarian society is upheld by natural law. Natural law is the complex of legal structures abstracted from the nature of man and the circumstances furthering his flourishing. Natural law helps to highlight the foundations of the “natural rights” of the individual.
From the point of view of natural law, statutory laws such as child labor laws violate the natural right of the individual to freely pursue the courses of action that maximize his wealth and happiness. By excluding the participation of an individual in the social division of labor that earns him the means of sustenance, it consigns the individual’s existence to a life of misery. This is a violation of the individual’s rights to property and exchange.
While we may be sympathetic to the plights of six year olds who are trafficked and coerced to work in so-called “sweatshops” and “coal mines,” it does not warrant a campaign for the enactment of restrictive laws that have the side effect of excluding the free and non-aggressive pursuit of economic goals by other members of society. We also must not forget the thousands of fifteen, sixteen, and seventeen-year-olds who are consigned to poverty and suffering due to child labor laws that prohibit them from earning a living.
