Anti-social behaviour orders can become a "self-fulfilling prophecy" and should not be imposed on the under-12s, a think tank says.
The IPPR says 46% of children breach their Asbos.
The Institute for Public Policy Research (IPPR) says Asbos can be ineffective and "speed children into the criminal justice system".
But it does not want them scrapped, saying they give the right message on what sort of behaviour is tolerated.
The Home Office says the majority of Asbos are issued to adults.
It says their purpose is to protect the law-abiding majority from the anti-social minority.
Home Office minister Vernon Coaker told Radio 4's Today programme that local communities were calling for more Asbos.
He said: "There's been in the last few years 10,000 Asbos, that's not a huge number, 5,000 for young people - targeted at those who are causing real problems.
"And the evidence from local communities themselves is that they believe they make a real difference. They help to prevent harming communities."
The IPPR's Julia Margo told BBC News Asbos could be "empty punishments" as there was no requirement for children to be assessed before an order was made.
"If you breach an anti-social behaviour order, you end up in a court, so they can sometimes speed children into the criminal justice system.
"Asbos are given for very low level misbehaviours in the community, so something like graffitiing a wall or public property or hanging outside with your friends and irritating neighbours or being very loud or noisy in a public place."
She said the orders were often ineffective, as they were breached by 46% of children issued with them.
She suggested the maximum Asbo length should be scaled back from 10 years to two years and the minimum from two years to six months.
"We don't think we should completely get rid of Asbo legislation because it is important and it does send out the right message about what kind of behaviour we tolerate in our community but we need to scale them back."
'Badge of honour'
The IPPR says Asbos for younger children should always be accompanied by a family or parenting order to address the "context of the behaviour".
Ms Margo said the most common factors behind a child offending was not spending much time with their parents and having a parent or adult carer who had committed a crime.
"So that really suggests that the root of the problem is the kind of adult that young people are mixing with, so that problem needs to be addressed, not just the individual child's behaviour," she said.
The IPPR says greater investment in playgrounds and clubs such as scouts and cadets could reduce offending by giving youngsters something constructive to do as well as encouraging adults to spend quality time with young people in their communities.
Paul Cavadino, chief executive of crime reduction charity Nacro, said Asbos had a high failure rate among young people.
"In itself, it doesn't provide positive support for the child or family to help them to change their behaviour.
"In some cases they can be used as a badge of honour and that means the child tries to live up to the hard image which he or she thinks the Asbo gives them - and that in itself can make matters worse."