Poverty and children's work in Spain and Latin America. Some preliminary remarks.

Abstract

In the first part of this paper we try to test the relationship between mothers earnings, fertility and children's work in the Spanish (Catalan) context of the first third of the 20th century. Specific human capital investment of adult working women had as an outcome the sharp increase of their real wage and also the increase of the opportunity cost of time devoted to house work including child rearing. Fertility evolution is endogenous to the model and decreases as a result of women real wage increases. Human capital investment of labouring women and mandatory schooling of children shift the labour supply function to a new steady state in which the slope is steeper. According to recent papers this model applies to 20th century Spain and it causes the abolition of children's work. Nonetheless the model do not apply to 20th century Latin America. Despite the positive evolution of literacy and life expectancy in this region, other factors involved poor results of the educational human capital investment. In this paper we remark the role of the increasing share of the informal sector of the economy ruled on the bases of women's and children's work. Second we stress the role of high income inequality evolution and endogamic school supplies to explain the limits of increasing literacy on more remarkable human capital improvements.