The Relationship Between Formality and Child Work in Base-of-the-Pyramid Family Businesses.

This article examines the relationship between the degree of formalization in family businesses and the use of child work in bottom-of-the-pyramid (BOP) economies, focusing on a sample from Eswatini. It finds an inverted U-shaped association whereby child work increases as businesses move from informal to semi-formal status, then decreases as they become fully formal, with semi-formal businesses exhibiting the highest child work. The study also shows that this pattern is more pronounced in women-led businesses and is less steep in higher-performing businesses. These findings are interpreted through institutional logics—family logic emphasizing loyalty and survival, and market logic emphasizing efficiency and profit—and family embeddedness perspectives, highlighting how these logics influence entrepreneurs' reliance on child labor across different formalization levels. The research suggests implications for policy and practice in supporting formalization while addressing child work in family enterprises within impoverished contexts.