An‐arrgh‐chy: The Law and Economics of Pirate Organization

Abstract

This article investigates the internal governance institutions of violent criminal enterprise by examining the law, economics, and organization of pirates. To effectively organize their banditry, pirates required mechanisms to prevent internal predation, minimize crew conflict, and maximize piratical profit. Pirates devised two institutions for this purpose. First, I analyze the system of piratical checks and balances crews used to constrain captain predation. Second, I examine how pirates used democratic constitutions to minimize conflict and create piratical law and order. Pirate governance created sufficient order and cooperation to make pirates one of the most sophisticated and successful criminal organizations in history.

Covenants without the Sword? Comparing Prison Self-Governance Globally

“…While the conventional wisdom identifies the government as a key provider of governance, theoretical research identifies a range of nonstate mechanisms that can make self-enforcing exchange viable (Axelrod and Hamilton 1981;Dixit 2007;Kreps 1990). An important empirical literature shows how extralegal governance works in practice in both historical and contemporary settings (Benson 1989;Bernstein 1992;Ellickson 1991;Greif 1993Greif , 2006bLeeson 2007aLeeson , 2007cLeeson , 2008Leeson , 2009Milgrom et al 1990;Schaeffer 2008;Stringham 2015). Laboratory experiments and simulations also identify when self-governance is possible (Axelrod 1981;Ostrom et al 1992).…”

Culture and the Historical Process

“…These institutions, which included checks on authority, separation of power, and written constitutions, were established to constrain predation by the captain, as well as shirking and free-riding of crew-members (Leeson, 2007). In this case, institutions were not shaped by cultural beliefs, but by efficiency considerations and material payoffs rather than by deeply held values.…”

Self-enforcing norms and efficient non-cooperative collective action in the provision of public goods

“…Moreover, a competition for the position of enforcer of property rights may become an additional source of inefficiency and worsen the outcome compared to anarchy (Skaperdas 2002). Leeson (2007b) describes and analyses the historical institutions by which pirates avoided being subject to predation by their captain.…”