Peer-reviewed article
The impact of unconditional cash transfers on child labour in Punjab: A fairlie decomposition approach
Faizan Ali, Mumtaz Anwar, Atif Khan Jadoon ·
Summary
Written by AI, not yet AICS's view · claude-haiku-4-5-20251001This study examined whether Pakistan's Benazir Income Support Program (BISP), an unconditional cash transfer scheme, reduces child labour in Punjab. Using data from the 2019-20 Punjab Child Labour Survey, researchers found that the cash transfers were not effective at reducing child labour. In fact, beneficiaries of BISP were more likely to engage in child labour than non-beneficiaries. The analysis identified household wealth, parental education, child schooling, and child age as major factors explaining differences in child labour between the two groups.
Key points
- Cash transfer programmes (BISP) were not effective in reducing child labour hours
- Beneficiaries of BISP were more likely to engage in child labour compared to non-beneficiaries
- Household wealth accounts for 46.14% of the working hours gap between the two groups
- Child age accounts for 43.51% of the gap in child labour between beneficiaries and non-beneficiaries
- Mother's education could reduce the gap by 12.61% if distributions were equalised
Limitations
The study is cross-sectional and cannot establish causation; it compares beneficiaries and non-beneficiaries at one point in time without tracking individuals over time. The analysis cannot determine whether BISP receipt causes increased child labour or whether other unmeasured factors explain both BISP receipt and child labour participation.
Abstract
To address the pressing economic challenges faced by low-income households, cash transfer programmes have emerged as strategic policy interventions aimed at mitigating child labour. This paper has examined the impact of Benazir Income Support Program (BISP) on the child labour in Punjab, Pakistan, by using the latest data set of Punjab’s Child Labour Survey (PCLS 2019–20). Multinomial logistic regression is employed to assess the impact of cash transfers on child labour (hours) and the Fairlie Decomposition method is used to assess the inequality. The regression findings indicate that cash transfer programmes are not effective in reducing child labour. We then decompose the inequality to identify key contributing factors of child labour hours. The Fairlie decomposition analysis shows that beneficiaries of BISP (BENs) are more likely to engage in child labour as compare to non-beneficiaries of BISP (Non-BENs). Household wealth status, mother & household head’s education, child schooling and child’s age are the significant contributors in explaining the gap of child labour between the two groups of our study. Household Wealth accounts for 46.14% of the working hours gap between BENs and Non-BENs, indicating it as a one of the major contributors of child captivating to work. The child age accounts up to 43.51% of the gap between the two groups. The gap can be reduced up to 12.61% if the distribution of mother’s education of the non-BENs is identical to the BENs. Addressing these issues among children including the policy debate of BISP will require a sustained effort by the government, institutions, with a particular focus on awareness, socioeconomic circumstances of working children, lower education backgrounds of parents, and belonging to poor households and underdeveloped segments.