Economic Human Rights (33): Sweatshops

No one’s in favor of sweatshops in developing countries (or elsewhere for that matter). But that doesn’t mean you have to believe that campaigning against them is a good thing. It’s quite possible to simultaneously believe that something is bad and that its disappearance would make things even worse. Generally, people work in the disgusting circumstances of a sweatshop because the alternative is even worse. People tend to select the occupation that’s least harmful and most profitable for them.

So even though sweatshops do indeed look like a microcosm of human rights violations – degrading working conditions, low salaries, and long hours, exposure to harmful materials, hazardous situations and extreme temperatures, abuse, exploitation (including sexual exploitation) and child labor – they may be better than the alternatives – a fine world we live in – and the fact that most sweatshop workers aren’t coerced by their employers indicates that this is the case.

Sweatshops insult our western sense of justice because we have a relatively low threshold for injustice. Without the opportunity to work in a sweatshop, many people in the Third World would be forced into subsistence farming, scavenging of garbage dumps, begging or even prostitution. All these alternatives may offer lower incomes and worse conditions. Campaigning against sweatshops can lead to their closure and force people into the even less appealing alternatives.

That’s why I argue against campaigns and boycotts. However, campaigns don’t have to lead to the closure of sweatshops and loss of jobs, and can even make things better – go figure:

We find that anti-sweatshop campaigns led to large real wages increases for targeted enterprises. We also examine whether higher wages led these firms to cut employment or relocate elsewhere. The results suggest that there were some costs in terms of reduced investment, falling profits, and increased probability of closure for smaller plants, but we fail to find significant effects on employment. (source, source)

A successful multinational may be profitable enough to be able to afford wage increases [as a response to campaigns], and may prefer to take wage increases on the chin rather than move its business around. (source)


1 thought on “Economic Human Rights (33): Sweatshops”

  1. I’ve looked at child labor a bit. I find the practice to be rather despicable. The idea that Nike, for example, couldn’t turn a profit if they paid their laborers a decent wage is just plainly absurd.

    But I agree with you that, under some (or current) circumstances, the disappearance of these things would be even worse. For example, it was estimated that 50,000 child workers were laid off in Bangladesh following a proposal of an anti-child labor bill by Senator Harkin in 1992. No one knows exactly what happened to these children, but it’s believed they went to the underground economy (e.g. child prostitution), where working conditions were even more misreable and less transparent. So simply outlawing it probably won’ work and might even have a negative effect.

    However, that isn’t to say nothing can be done. The ILO estimates that if countries (with the aid of developed nations) subsidized the education of these child laborers (as opposed to allowing them to work), there would be a total net benefit to the global economy on the order of $4.3 trillion dollars. (I believe I got that statistic from this Web site.) So I think we should work to abolish things like sweatshops and child labor, but we should also be advocating better alternatives, like subsidized education.


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