Household Access to Microcredit and Child Work in Rural Malawi

This paper examines the effect of household access to microcredit upon work by children in rural Malawi. It aims to discover whether access to microcredit might increase work by children. The paper discusses:

• The negative effect that child labor has on child welfare;
• Statistics presented by the International Labor Organization (ILO) about child labor in Africa;
• The relationship between access to credit, poverty, child labor and schooling.

The study allows for the possibility of a positive relation between household access to microcredit and work by children. It:

• Distinguishes between children's domestic chores and work in household enterprises;
• Finds that following improved access to microcredit, adults are busied in household enterprises and children replace them in shouldering domestic chores;
• Measures household access to credit in a novel manner as the sum of the self-assessed credit limits of household members at microcredit organizations;
• Examines the trade-off between children's work and schooling in rural Malawi.

The study finds that household access to microcredit in rural Malawi:

• Raises children's propensity to work;
• Is significantly related only to children's household domestic work;
• Has no statistically discernible effect upon children's school attendance.

The report concludes that:

• Children's leisure may temper the trade-off between work and schooling;
• Child development specialists may consider this a weighty negative consequence of the burgeoning of microcredit organizations.