This chapter compares the living standards provided by sweatshop wages to other alternative living standards in the countries where sweatshops are located. The main finding is that sweatshop pay compares favorably with widespread poverty living standards and agricultural earnings in the countries in which sweatshops operate and often even compares favorably with average living standards.

This chapter provides a history of sweatshops during the industrial revolution in the United States and Great Britain and explains how higher wages and better conditions were eventually attained. It then looks at the postwar East Asian economies that had sweatshops and that developed more rapidly than Great Britain and the United States did. Finally, the chapter looks at how economic development has taken place over the last two decades in countries that had sweatshops identified in the first edition of this book and how sweatshop wages have improved.

This chapter introduces the economic perspective on sweatshops and some alternatives available to workers. It explains the ethical standard – the welfare of Third World sweatshop workers and other poor people in the countries where sweatshops are located – that will be used throughout the book, and it provides an overview of what will be covered in the coming chapters.

This chapter shows that child labor is common in most countries with sweatshops but that most children don’t work in manufacturing – most work in agriculture or the service sector. Thus, calls to ban imported sweatshop goods made using child labor ends up shifting even more children into agriculture and services where pay is often lower and work less safe. The chapter argues that the process of economic development that raises average incomes has been the main cure for child labor. Anti–child labor laws typically codify improvements that market competition already achieved.

This chapter explains how the market process creates the right capital and technology to promote the process of development. It explains how an institutional environment of economic freedom best promotes the process of development and provides empirical evidence to support this view. It then reviews how economic freedom has evolved in countries that had sweatshops identified in the first edition of this book.

This chapter explains how working conditions and wages are jointly determined. Overall productivity limits total compensation but then how total compensation is split between monetary wages and other working conditions is largely driven by employee preferences. Safer and more pleasant working conditions are what economists call normal goods. When worker compensation goes up, workers demand greater safety and better conditions. Thus, the poor working conditions in sweatshops largely reflect the fact that these workers are desperately trying to feed, clothe, and shelter their families and prefer the bulk of their compensation in monetary wages. The chapter explains how legally mandating better conditions makes workers worse off by both unemploying some workers and changing the mix of compensation into a less desirable mix from the workers’ perspective. It illustrates this lesson with survey evidence from sweatshop workers in Guatemala.

Wraps up the main message of the book.

This chapter argues that if anti-sweatshop activists want to help workers they should specifically target and boycott slave labor sweatshops such as those in China with forced Uyghur labor; advocate and monitor “ethical branding”; buy goods made in the Third World; pay children to go to school to reduce child labor; promote the process of development; and advocate for relaxing immigration restrictions.

This chapter explains the process that determines wages paid to sweatshop workers. It explains the consequences of imposing minimum wage laws and boycotting sweatshops. The chapter articulates the basic economic reasoning that leads many of the demands of anti-sweatshop activists to harm worker welfare. It then considers objections made to this basically economic case that include the necessity of competitive markets; efficiency wages; passing costs on to consumers; cost cutting in other areas; accepting a lower rate of return; and how elasticity impacts overall worker welfare. An appendix to the chapter considers philosophical aspects of how to think about worker welfare. This core chapter outlines the main lesson of the book.

This chapter argues that it is ethical to buy sweatshop products. It explains why arguments to the contrary made in the business ethics literature fail, why sweatshops are not wrongfully exploitative, and why it is better to benefit workers a little bit rather than not at all. It also considers how background injustices impact the ethics of sweatshop employment, and finally reviews issues of worker autonomy and goals other than the welfare of sweatshop workers.

This chapter reviews the various organizations that comprise the anti-sweatshop movement and what policies they advocate. It provides a history of the origins and growth of the anti-sweatshop movement.

This chapter investigates the impact of anti-sweatshop activism on garment industry employment and the number of firms in Bangladesh following the 2013 Rana Plaza factory disaster. The disaster led to activism that created two major brand-enforced factory fire and safety agreements. The chapter uses a synthetic control methodology to investigate the trade-offs associated with the reaction to the disaster and finds that they led to 33.3 percent fewer garment factories in Bangladesh by 2016 and 28.3 percent fewer people employed in Bangladesh’s garment industry by 2017. Given the importance of the garment industry in Bangladesh’s development in providing a pathway out of extreme property, this finding raises important questions about the efficacy of anti-sweatshop activism.