pirate economics

Peter Leeson (George Mason University) studies pirates. How can you beat that for interesting economics? He hopes that by better understanding pirate organizations, we can better understand other criminal enterprises.

His 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.

The paper will be published in a future issue of the Journal of Political Economy.

download the paper

the press release