Effective Incentives: A Proposal of Two Changes to United States Federal Law to Improve Working Conditions in Overseas Factories




Watt, Ethan Davis Merritt

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Transnational corporations and their practice of outsourcing manufacturing jobs to less developed nations with less restrictive labor laws have created a system of production wrought with considerable labor abuse and which encourages zero accountability. For years, all relevant parties with the power to effect change - consumers, corporations, Western governments, international bodies - have refused to take the helm of the global social justice responsibility movement. In recent years, both corporations and consumers have made some effort to take responsibility for these serious labor abuses, but these endeavors have been unsuccessful at effecting genuine change in the treatment of factory labor. There has still not been a serious push by government entities - and especially not by the United States government, which has jurisdiction over many of the biggest corporations in the world - to implement policy changes effective at combating labor abuse. This paper will illustrate some of the labor abuses occurring in Chinese factory suppliers of major U.S. corporations, outline existing U.S. laws which can be modified to incentivize stakeholders to improve factory working conditions, and propose and defend two necessary policy changes: the introduction of a new tax credit, and the creation of the Alien Labor Statute, a law parallel to the Alien Tort Statute.



China, factory labor abuse, sweatshop, tax credit, alien tort statute, U.S. laws, Honors College


Watt, E. D. M. (2012). Effective incentives: A proposal of two changes to United States federal law to improve working conditions in overseas factories (Unpublished thesis). Texas State University-San Marcos, San Marcos, Texas.


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