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The B.E. Journal of Macroeconomics

Editor-in-Chief: Abraham, Arpad / Cavalcanti, Tiago

Ed. by Carceles-Poveda , Eva / Kambourov, Gueorgui / Lambertini, Luisa / Ruhl, Kim

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The Effects of Industrialization on Education and Youth Labor in Indonesia

Maya Federman1 / David I. Levine2

1Dept. of Economics, Pitzer College,

2Haas School of Business, UC Berkeley,

Citation Information: Contributions in Macroeconomics. Volume 5, Issue 1, ISSN (Online) 1534-6005, DOI: 10.2202/1534-6005.1243, February 2005

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This study examines the relationship between growth in manufacturing employment and youth outcomes in Indonesia from 1985 to 1995, a time of rapid industrialization. In comparison with cross-national studies, this study has a larger sample size of regions, defines data more consistently, and conducts better checks for causality and specification. We also distinguish between the effects of manufacturing employment in the region and in the household and explore potential causal mechanisms underlying the observed correlations. Overall, manufacturing employment in the region modestly increases enrollment and decreases labor force participation for male and female young teens. At the household level, employment of adult females in manufacturing is associated with lower enrollment and higher labor force participation for young women relative to young men.

Keywords: Education; Industrialization; Child labor; Indonesia

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