Is there any relationship between child labour, crime rates and country income per capita?

Child labour exists in varying degrees in virtually all countries aspiring to reach high income status. The prevalence of child labour and associated criminal activities have been portrayed in the 19th century novels of Charles Dickens, perhaps most vividly in the character ‘Fagin’ in the novel ‘Oliver Twist’. It seems clear that the early years of the industrial revolution in Britain gave rise to demand for increased child labour and also provided fertile ground for criminal activities. However, it is also evident from the experience of the high-income countries that the hallowed peaks of the development process witness an end to such activities representing the dark side of income creation. This paper examines whether there is a definite relationship between country income per capita and the prevalence of crime and child labour. The presumption is that as incomes grow there is an increase in the use of child labour as well as in crime, with a tapering- off after a certain income level. This paper presents evidence for such an inverted ‘U’ relationship between child labour and income per capita as well as between the crime index and income. These findings may also throw some light on the puzzle of the sudden fall in U.S crime rates in the 1990s

Portfolio diversification in extreme environments : are there benefits from adding commodity futures indices?

Diversifying into commodity futures indices to improve risk-return trade-offs had seemed an inviting prospect a couple of decades ago, due to the increasing correlations between equities themselves and the stable low or negative correlations they exhibited with commodities. But there is a view gaining ground now that the benefits of stock portfolio diversification into commodities have died out due to further changes in the correlation matrices, particularly occurring in times of extreme events. This paper readdresses the aforesaid issue for the period 1999-2010, disaggregated into periods so as to bracket bull and bear phases with large changes in returns. Data for the most important equity and commodity indices are used. One interesting finding is that the role of commodities in optimum portfolio diversification may be more relevant in bear phases.peer-reviewe