Conventional wisdom states that “government must intervene in the economy to bring about improved working conditions.” However, if we examine how the free market naturally promotes continued improvement in safety standards and comfort in the workplace, independent of legislation or government organizations, we are likely to determine that quite the opposite is true.

On one hand, many improvements in working conditions are quick to pay for themselves–be it basic safety equipment or such amenities as electric lights which enable workers to see what they are doing. Productivity would diminish drastically in environments lacking these types of improvements. On the other hand are those that do not readily pay for themselves but offer some sort of benefit that can offset wage rates. Air conditioning is one such improvement. If it were mandated that all workplaces be equipped with these costly systems, wages would drop and many would be left with no job at all.

The concept of compensating differentials is one among many free-market systems that allows for much more efficiency than an economy where certain standards are mandated by law. A compensating differential essentially refers to the trade-off between lower wages and safer, more pleasant working environments. When left uninhibited, prospective employees are free to choose whether they would prefer to earn higher wages while working in less desirable conditions, or vice versa. Perhaps many workers will opt to strike a balance between the two. This is the beauty of the free market at work.

This same principle can be applied to mandatory limits on working hours. This is another area in which economic growth resulting from a free market naturally resolves the issue at hand. Promoters of such laws that limit how many hours one may work per week do not take into account the fact that as productivity increases thanks to technological advancements, the need for extremely long work weeks naturally diminishes.

There is another trade-off here: leisure time versus working time. If someone wished to earn more by sacrificing what would otherwise be leisure time, they should have the right to make that decision for themselves.

Those less fortunate may not be able to make such voluntary choices at all. An example of this in certain primitive societies today is child labor. Nearly universal is the desire of mankind to abolish this practice altogether, for it is seen as unethical that children would be forced to endanger themselves in various types of work environments. Yet for those families who actually participate in child labor, it is seldom a choice. It is often the only viable means by which families in highly impoverished nations are able to make a living for themselves.

Activists who attempt to have child labor abolished by means of forcible legislation have failed to realize that it is not because of evil parents who force their children to work that such practices still remain commonplace in less prosperous nations today. As David Henderson put it in his 2000 article entitled The Case for Sweatshops, “You don’t make someone better off by taking away the best of a bunch of bad choices.”

In the case of child labor, albeit undesirable, it is much less detrimental than its alternatives. In the same article, Henderson points to an Oxfam report that indicates that after thousands of children were fired from factories in Bangladesh who wanted to appease critics of child labor, the children were forced into prostitution or starved to death.

Therein the question lies: if government legislation cannot satisfactorily alleviate the child labor problem, how can it be resolved? The answer that we can find by looking at history is, once again, increased economic growth and prosperity by means of a free market without government intervention.

As I mentioned in a previous essay on foreign aid, statistics provide insight into the effects of state interference in economies around the globe. The least free economies are also those facing the most devastating poverty situations. Whereas these nations continue to turn to child labor as a necessity for survival, such economies as that of the United States–which has operated relatively freely throughout the 19th and 20th centuries–have greatly prospered and have alleviated this and other issues that accompany extreme poverty.🔹