International Labor Standards History,

This book addresses the controversial call for international labor standards, seeking to productively further this debate by considering the economic implications and history of these standards. A result of an initiative by Professor Kaushik Basu in his capacity as member of the Expert Group of Development Issues (EGDI) sponsored by the Swedish Foreign Ministry, the contributions are based on discussions at a seminar held in Stockholm in August 2001. They focus on four central questions: bull; bull;How did the labor standards movement evolve in the past, and what can we learn from its history? bull;What do contemporary economic theories tell us about the possible impact of international labor standards? bull;What solid empirical evidence do economists have about the incidence, causes and effects of child labor? bull;What kind of global institutions do we have or need in order to enforce any agreement on labor standards, and what role should the ILO and WTO play? Compiling the best research in the field, this book provides a solid basis for policy decisions, while also serving as a challenging text for students in trade, development, and labor economics.

Kaushik Basu is Professor of Economics and Carl Marks Professor of International Studies in the Economics Department at Cornell University. He is Editor of Social Choice and Welfare and Associate Editor of The Journal of Economic Perspectives and The Journal of Development Economics. He is the author of many books and articles, including The Less Developed Economy, (Blackwell Publishers, 1984), Lectures in Industrial Organization Theory (Blackwell Publishers, 1993), and Analytical Development Economics (1997).

Henrik Horn is Professor of International Economics at Stockholm University. His current research focuses on various aspects of the WTO, with particular emphasis on the functioning of its Dispute Settlement system.

Lisa Román is the Secretary to the Expert Group on Development Issues (EGDI) and has been with the secretariat since 1999. She has a background as a development economist and is the author of Institutions in Transition: Vietnamese State Bank Reform (1999).

Judith Shapiro is Professor of Health Economics at the New Economic School, and has been a member of the EGDI since 1995. She is the author of a number of articles on Russian health, labor and mortality, and three co-authored books on transformation and integration in Eastern Europe.

List of Tables and Figures

ix

List of Acronyms

xi

List of Contributors

xii

Part I: Introduction

1

(6)

Kaushik Basu

Henrik Horn

Lisa Roman

Judith Shapiro

Part II: The Evolution of Labor Standards

7

(98)

The History and Political Economy of International Labor Standards

9

(96)

Stanley L. Engerman

Introduction

9

(1)

Categories of Labor Standards

10

(1)

The Sources of Agitation for Improved Labor Standards

11

(12)

Morals and Economics: Long-standing Arguments

23

(7)

Control and Enforcement

30

(1)

Patterns of Labor Standards Evolution

31

(5)

Early Examples of Legislation

36

(3)

The Types of Legislation

39

(21)

The Impact of Labor Standards

60

(1)

Early International Agreements

60

(6)

The International Labor Organization

66

(2)

Final Remarks

68

(1)

Appendix 1: Labor Standards in the Scandinavian Nations

69

(15)

The Parallels Between the Past and the Present

84

(1)

Jane Humphries

The Parallels Between the Past and the Present

84

(4)

The Macroeconomics of Child Labor

88

(4)

The Microeconomics of Child Labor

92

(1)

Labor Standards and Social Policy

93

(1)

Conclusion

94

(1)

Appendix: Nussbaum's List

95

(10)

Legislation Versus Bargaining Power: The Evolution of Scandinavian Labor Standards

99

(6)

Karl-Ove Moene

Michael Wallerstein

Part III: The Theory of International Labor Standards

105

(88)

The Impact of International Labor Standards: A Survey of Economic Theory

107

(86)

Nirvikar Singh

Introduction

107

(3)

Delineating Labor Standards

110

(6)

Labor Markets and Labor Standards

116

(19)

Labor Standards in the Global Economy

135

(9)

Who Decides and How?

144

(12)

What Happens to the Poor?

156

(9)

Conclusion

165

(1)

Appendix 1: Basic Competitive Model

166

(1)

Appendix 2

167

(3)

Appendix 3: Monopsony

170

(18)

Old Wine in New Bottles?

182

(5)

T.N. Srinivasan

Governing Labor Relations

187

(1)

Tore Ellingsen

Incomplete Contracts and Workers' Rights

188

(1)

Working Conditions

189

(1)

Conclusion

190

(3)

Part IV: The Issue of Child Labor

193

(78)

Child Labor: Theory, Evidence, and Policy

195

(76)

Drusilla K. Brown

Alan V. Deardorff

Robert M. Stern

Introduction

195

(1)

Theories of Child Labor: Models of Household Decisions

196

(5)

Empirical Evidence on the Determinants of Child Labor

201

(17)

Traditional Policies Targeting Child Labor and Education

218

(7)

Recent Policy Initiatives Addressing Child Labor

225

(12)

Child Labor Standards Initiatives in the International Arena

237

(4)

Conclusions

241

(13)

The Political Economy of Child Labor

248

(6)

Alan B. Krueger

Conclusion

254

(2)

Social Norms, Coordination, and Policy Issues in the Fight Against Child Labor

256

(1)

Luis-Felipe Lopez-Calva

The Role of Social Norms

256

(11)

A Comment on Policy

267

(1)

Concluding Remarks

267

(4)

Part V: The International Organization and Enforcement of Labor Standards

271

(55)

A Role for the WTO

273

(53)

Robert W. Staiger

Introduction

273

(3)

Identifying the Problems

276

(5)

The Institutional Features of the WTO and the ILO

281

(9)

The Assignment of Problems to Institutions

290

(2)

The Role of the WTO in Preventing Race-to-the-bottom/Regulatory-chill Problems

292

(6)

The Role of the WTO in Enforcing ILO Agreements

298

(4)

Evaluating the Options

302

(2)

Summary and Conclusion

304

(10)

Trade and Labor Standards: To Link or Not to Link?

309

(5)

L. Alan Winters

The Need to Micro-Manage Regulatory Diversity

314

(1)

Petros C. Mavroidis

The Argument in Staiger's Study

314

(1)

The Argument in this Commentary

314

(1)

The Function of the WTO Contract in a Nutshell

315

(5)

The Limits of the Current WTO Contract

320

(6)

Index

326

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International Labor Standards History, Theory, and Policy Options

Summary

Author Biography

Table of Contents

Supplemental Materials