Abstract
This paper examines the medium- and long-run effects of Brazil’s 1990s trade liberalization on child labor, schooling, and human capital accumulation. Drawing on Census and administrative data spanning nearly three decades, we exploit cross-regional variation in two components of the trade shock that differentially affected labor market opportunities for adults and children. We find that regions more exposed to child-specific tariff reductions experienced larger declines in child labor and greater increases in school attendance; those more exposed to adult-specific tariff reductions experienced the opposite. The impacts of the shocks are persistent and always larger in the long run. Specifically, we show that cohorts whose formative years coincided with the reform accumulated less human capital where adult-specific shocks were greater, and more where child-specific shocks were larger. Overall, our results highlight the role of human capital in amplifying the effects of economic shocks.