SFSU An arrgh chy The Law and Economics of Pirate Organization Case Questions

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I’m working on a economics discussion question and need an explanation and answer to help me learn.

I need these five questions answered using the article I’ve attached. 1) What are the main organizational problems faced by pirate organizations? 2) Where do pirate crew’s organizational forms come from? 3) What are the primary organizational difference between pirates and merchant ships? Why do you think these differences came about?4) Why would someone be a pirate? 5) How did pirate leaders induce group members to act in the interest of the pirate organization?

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An-arrgh-chy: The Law and Economics of Pirate
Organization
Peter T. Leeson
George Mason University
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.
Nature, we see, teaches the most Illiterate the necessary
Prudence for their Preservation . . . these Men whom we
term, and not without Reason, the Scandal of human Nature, who were abandoned to all Vice, and lived by Rapine;
when they judged it for their Interest . . . were strictly just
. . . among themselves. (Captain Charles Johnson 1726–
28, 527)
I am especially grateful to Steven Levitt and two anonymous referees for thorough and
insightful comments on an earlier draft of this paper. I also thank Pete Boettke, Tyler
Cowen, Chris Coyne, Josh Hill, Bill Reece, Andrei Shleifer, Russell S. Sobel, Werner Troesken, and William Trumbull for helpful comments and suggestions. The financial support
of the Kendrick Fund and the Kaplan Fund is also gratefully acknowledged.
[ Journal of Political Economy, 2007, vol. 115, no. 6]
? 2007 by The University of Chicago. All rights reserved. 0022-3808/2007/11506-0001$10.00
1049
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I.
journal of political economy
Introduction
Pirates are known for raucousness, recklessness, and chaotic rapine.
Pirate reality, however, is quite another picture. Real-life pirates were
highly organized criminals. Unlike the swashbuckling psychopaths of
fiction, historical pirates displayed sophisticated organization and
coordination.
Pirates could not use government to enforce or otherwise support
cooperative arrangements between them. Despite this, they successfully
cooperated with hundreds of other rogues. Amidst ubiquitous potential
for conflict, they rarely fought, stole from, or deceived one another. In
fact, piratical harmony was as common as harmony among their lawful
contemporaries who relied on government for social cooperation. How
did “these men whom we term . . . the Scandal of human Nature, who
were abandoned to all Vice, and lived by Rapine” (Johnson [1726–28]
1999, 527)1 accomplish this impressive level of order?
Becker (1968) was the first to apply the logic of rational-choice decision making to criminals. Following him, a number of others extended
this logic to decision making in the context of organized outlaws. Fiorentini and Peltzman (1995) provide the best and most comprehensive
collection of essays that consider the economics of criminal organization. In addition, a large literature discusses the economic impact of
organized crime, activities of criminal organizations, optimal strategies
for preventing organized crime, and reasons for its emergence (see also,
e.g., Anderson 1979; Reuter 1983, 1987; Jennings 1984; Arlacchi 1986;
Jankowski 1991; Dick 1995; Konrad and Skaperdas 1998; Garoupa 2000;
Skaperdas 2001; Chang, Lu, and Chen 2005).
Unlike these topics, the internal governance institutions of violent
criminal organizations have received relatively little attention.2 The difficulty of “getting inside” criminal organizations is largely responsible
for this. Levitt and Venkatesh’s important work on street gangs (Levitt
and Venkatesh 2000; Venkatesh and Levitt 2000) is an exception to this
rule, as are Gambetta’s (1993) and Reuter’s (1983) superb studies of
the Mafia. However, Levitt and Venkatesh focus on the financial organization of gangs rather than on their governance structures. Gambetta’s
and Reuter’s studies are primarily concerned with the Mafia’s provision
of protection to outsiders and the organization of the illegal markets it
serves.
1
All page references to Johnson refer to the 1999 reprint. Page references to other
early sources also refer to reprint editions if available.
2
Anderson (1979), Reuter (1983), and Gambetta (1993) are the closest exceptions in
this regard. Their excellent work considers some internal governance aspects of the Mafia
but tends to focus primarily on the Mafia’s relationship to protection and other markets.
Important research by Polo (1995) examines governance institutions of criminal organizations, but does so theoretically.
law and economics of pirate organization
1051
This article investigates the internal governance institutions of violent
criminal enterprise by examining the law, economics, and organization
of pirates.3 These “most treacherous rogues” terrorized the Caribbean,
Atlantic Ocean, and Indian Ocean during the seventeenth and eighteenth centuries. Pirates formed a loose confederation of maritime bandits outside the law of any government.
To effectively organize their banditry, pirates required mechanisms
to prevent internal predation, minimize crew conflict, and maximize
piratical profit. I argue that pirates devised two institutions for this purpose. First, I analyze the system of piratical checks and balances that
crews used to constrain captain predation. Second, I examine how pirates used democratic constitutions to minimize conflict and create piratical law and order. Pirates adopted both of these institutions before
seventeenth- and eighteenth-century governments.
Their governance institutions were self-enforcing by necessity. Appealing to the formal enforcement mechanisms of the state is not an
option for criminal organizations, including pirates. Although the maritime nature of piratical expeditions makes certain aspects of their
internal organization and governance specific to pirates, my analysis
highlights important problems that any form of organized criminal enterprise faces, as well as the institutional solutions such organizations
employ to overcome these problems.
The literature that addresses the economics of organized crime focuses on the criminal organization as a supplier of some service, usually
protection, to other actors inside and outside the criminal world. Schelling (1971), for instance, who was among the first to conduct this research, identifies the provision of enforcement services to other agents
and, in line with this function, a monopoly on coercion as the distinguishing features of organized crime.
While this definition is perhaps appropriate for the Mafia, it neglects
equally important organized criminal activities that do not provide useful services to others and do not involve a monopoly on coercion. An
army of thieves, for instance, that coordinates its activities, requires
internal mechanisms of governance, and combines in a long-term arrangement for concerted plunder is as much a criminal organization
as the Mafia.
Pirates were clearly organized criminals and yet were not primarily
in the business of providing services to anyone other than their members.4 Nor did they have a monopoly on force. Because of this, unlike
3
This article is also closely connected to the literature that examines the private emergence of law and governance institutions. See, e.g., Friedman (1979), Benson (1988, 1989,
1990), Anderson and McChesney (2002), Anderson and Hill (2004), Anderson, Benson,
and Flanagan (2006), and Leeson (2007a, 2007b, forthcoming).
4
However, pirates did trade with European colonists.
1052
journal of political economy
most discussions of criminal organization, mine takes a broader view of
organized crime. This view encompasses any long-term arrangement
between multiple criminals that requires coordination and involves
agreements that, owing to their illicit status, cannot be enforced by the
state.5 The emphasis of my analysis therefore shifts from the organization
of criminal markets (the focus of existing research on the economics
of organized crime) to the internal predation problem that criminal
organizations face and the institutions that emerge in response to it.
To examine these features for pirates, I draw on a series of historical
documents that provide a firsthand glimpse into their organization. The
first of these is Captain Charles Johnson’s General History of the Pyrates
(1726–28), which contains reports on a number of history’s most infamous pirates related by a pirate contemporary.6 I also draw on Alexander Exquemelin’s (1678) invaluable account of the seventeenthcentury buccaneers. Exquemelin was a surgeon who sailed with the
buccaneers and provides a detailed, firsthand account of their raids,
system of rules, and social organization. The buccaneer William Dampier (1697–1707) also published a journal relating to his maritime exploits, which I make use of as well.
Buccaneers differ from “pure” pirates in that they frequently plundered ships with government sanction. However, many other times they
plundered without official permission, as full-blown pirates. These protopirates, many of whom turned to pure piracy when governments
stopped issuing licenses for plunder, influenced and anticipated the
organization of pure pirates in the late seventeenth and early eighteenth
centuries. Buccaneer records are therefore important for understanding
the institutions and organization of seventeenth- and eighteenth-century
pirates.
In addition to these sources, correspondence from colonial governors
relating to piracy and records from the trials of various pirates, such as
testimony from individuals taken prisoner by pirate ships and the tes5
My definition of a criminal organization is therefore similar to Polo’s as “one that
cannot rely on the external enforcement of the judicial institutions and whose behaviour
and possibilities are not constrained by the law” (1995, 87).
6
“Captain Johnson” is a pen name used by the author of A General History of the Pyrates.
His true identity remains unknown. In 1932, John R. Moore claimed that Johnson was in
fact Daniel Defoe. In the late 1980s, however, this view was overturned (see Furbank and
Owens 1988), and today many pirate historians do not believe that Defoe is the author
of this important book (see, e.g., Rediker 2004; Cordingly 2006; Woodard 2007; for the
opposing view, see Rogozinski 2000). Whatever Johnson’s true identity, it is agreed that
he “had extensive first-hand knowledge of piracy” (Konstam 2007, 12). While it is widely
acknowledged that Johnson’s work contains some errors and apocryphal accounts (such
as the community of Libertalia), “Johnson is widely regarded as a highly reliable source
for factual information” on pirates (Rediker 2004, 180) and remains a definitive source
historians rely on in constructing their accounts of seventeenth- and eighteenth-century
piracy. As eminent pirate historian David Cordingly puts it, this book “is the prime source
for the lives of many pirates of what is often called the Golden Age of Piracy” (2006, xx).
law and economics of pirate organization
1053
timony of pirates themselves, form an important part of the historical
record this article relies on.7 Finally, a few pirate captives, such as William
Snelgrave (1734), whose captors ultimately released them, published
longer works describing their harrowing captivity by pirate crews.8 I also
draw on these accounts, which provide important firsthand records describing piratical governance and organization.9
II.
A “Nest of Rogues”
Seventeenth- and eighteenth-century pirates occupied the waterways
that formed major trading routes.10 These included the waters surrounding the Bahamas that stood between ships traveling from Central America to Spain; the waters connecting Europe and the North American
seacoast; those between Cuba and Haiti, which separated ships traveling
from Europe and the west coast of Africa to Jamaica; and the waters
around Madagascar traveled by ships sailing to and from India (Cordingly 2006, 88). These areas encompass major portions of the Atlantic
and Indian Oceans, Caribbean Sea, and Gulf of Mexico. The trade
routes connecting the Caribbean, North America’s Atlantic seacoast,
and Madagascar consequently formed a loop called the “pirate round”
that many pirates traveled in search of prey.
The “golden age” of piracy, when pirates were at their strongest, extended from 1690 to 1730 (Konstam 2002, 94).11 The years from 1716
to 1722 mark the height of the golden age. “This was at a Time that
the Pyrates had obtained such an Acquisition of Strength, that they were
in no Concern about preserving themselves from the Justice of Laws”
(Johnson 1726–28, 87). The pirates of this era include many well-known
7
Jameson (1923) has edited an excellent collection of such records. Unless otherwise
noted, all depositions and examinations quoted here are contained in his collection.
8
Importantly, drawing on the historical episode of pirates helps overcome the problem
of “getting inside” criminal organizations, noted above. Records from individuals who had
direct experiences with pirates, as well as those that shed light on piratical governance
mechanisms from pirates themselves, allow me to view pirates’ criminal organization “from
the inside.”
9
Additionally, this article relies on and is greatly indebted to a voluminous modern
literature covering all aspects of piracy, including those considered here, written by contemporary historians. Some of the best discussions belong to Gosse (1946), Pringle (1953),
Rankin (1969), Rediker (1981, 1987), Cordingly (1996, 2006), Rogozinski (2000), and
Konstam (2002).
10
The “nest of rogues” terminology in this section’s heading comes from Governor
William Spotswood, who, in a letter to the British Lords of the Admiralty, complained of
the growing pirate problem in New Providence (July 3, 1716 [1882, 2:168]).
11
The dates given by historians to mark the golden age of piracy vary. Cordingly (2006)
provides a slightly larger range, from about 1650 to 1725. Still others, such as Rankin
(1969), date the great age of piracy as encompassing the years between 1630 and 1720.
The further back in this range one goes, the more one is dealing with buccaneers as
opposed to pure pirates.
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journal of political economy
sea robbers, such as Blackbeard, whose real name was Edward Teach,
Bartholomew Roberts, and others.
Pirates were a diverse lot.12 A sample of 700 pirates active in the
Caribbean between 1715 and 1725, for example, reveals that 35 percent
were English, 25 percent were American, 20 percent were West Indian,
10 percent were Scottish, 8 percent were Welsh, and 2 percent were
Swedish, Dutch, French, and Spanish (Konstam 2002, 9). Others came
from Portugal, Scandinavia, Greece, and East India (Marx 1996b, 103).
Pirate crews were also racially diverse. Based on data available from
23 pirate crews active between 1682 and 1726, the racial composition
of ships varied between 13 and 98 percent black. If this sample is representative, 25–30 percent of the average pirate crew was of African
descent (Kinkor 2001, 200–201).
The pirate population is difficult to precisely measure but by all
accounts was considerable.13 According to the reports of contemporaries and estimates of pirate historians, in any one year between
1716 and 1722 the loop that formed the pirate round contained
between 1,000 and 2,000 sea bandits (see, e.g., Johnson 1726–28,
132; Pringle 1953, 185; Rediker 1987, 256; Marx 1996b, 102, 111;
Konstam 2002, 6).14 The buccaneering community of the seventeenth
century must have been even larger than this since, as I discuss below,
some firsthand observers report single expeditions of 2,000 men (Exquemelin [1678] 2000, 171).
Contrary to most people’s images of pirate crews, they were quite
large. On the basis of figures from 37 pirate ships between 1716 and
1726, it appears that the average crew had about 80 members (Rediker 1987, 256; see also Deposition of Simon Calderon 1682, Public
Record Office, Colonial Office Papers 1:50, no. 139). A number of
12
Pirates also exhibited some diversity in social standing. Although most pirates were
uneducated and came from the lower classes of society, a few, such as Dr. John Hincher,
were well educated and came from higher stations in life (Cordingly 2006).
13
Pure pirates should be distinguished from buccaneers, privateers, and corsairs. Pure
pirates were total outlaws and attacked merchant ships indiscriminately for their own gain.
Privateers and corsairs, in contrast, were both state-sanctioned sea robbers. Governments
licensed the former to attack enemy ships in times of war. Governments licensed the latter
to attack the ships of other nations on the basis of religion. “Buccaneering was a peculiar
blend of piracy and privateering in which the two elements were often indistinguishable”
(Marx 1996a, 38). Oftentimes, buccaneers plundered with official sanction, making them
more like privateers than pirates. Many other times, however, they did not. In these cases
they were acting as pure pirates.
14
These numbers are especially large when one puts them in historical perspective. The
Royal Navy, e.g., averaged only 13,000 men in any one year between 1716 and 1726,
making the pirate population in a good year more than 15 percent of the navy population
(Rediker 1987, 256). In 1680, the total population of the American colonies was less than
152,000 (Hughes and Cain 1994, 20). In fact, as late as 1790, when the first U.S. census
was taken, only 24 places in the country had populations greater than 2,500 (Hughes and
Cain 1994, 28).
law and economics of pirate organization
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pirate crews were closer to 120, and crews of 150–200 were not uncommon (see, e.g., Snelgrave [1734] 1971, 199; Examination of John
Brown, May 6, 1717, Suffolk Court Files, no. 11945, paper 5; Deposition of Theophilus Turner, June 8, 1699, Public Record Office,
Colonial Office Papers 5:714, no. 70 VI; Examination of John Dann,
August 3, 1696, London, Public Record Office, Colonial Office Papers 323:2, no. 25; Deposition of Adam Baldridge, May 5, 1699, Public
Record Office, Colonial Office Papers 5:1042, no. 30 II; Johnson
1726–28, 442; Cordingly 2006, 165).
Several pirate crews were bigger than this. For example, Blackbeard’s
crew aboard the Queen Anne’s Revenge was 300 men strong (Public Record
Office, Colonial Office Papers 152/12, no. 67, iii; quoted in Cordingly
2006, 165–66; see also Marx 1996b, 112). Even a sixth-rate Royal Navy
ship in the early eighteenth century carried more crew members than
the average pirate vessel (about 150). But compared to the average 200ton merchant ship, which carried only 13–17 men, pirate ships were
extremely large (Rediker 1987, 107). Furthermore, some pirate crews
were too large to fit in one ship. In this case they formed pirate squadrons. Captain Bartholomew Roberts, for example, commanded a squadron of four ships that carried 508 men (Cordingly 2006, 111).
In addition to this, multiple pirate ships sometimes joined for concerted plundering expeditions. The most impressive fleets of sea bandits
belong to the buccaneers. Alexander Exquemelin, for example, records
that Captain Morgan commanded a fleet of 37 ships and 2,000 men
sufficient to attack coastal communities on the Spanish Main (1678,
171). Elsewhere, he refers to a group of buccaneers who “had a force
of at least twenty vessels in quest of plunder” (69; see also 85, 105, 93).
Similarly, William Dampier ([1697–1707] 2005, 62) records a pirating
expedition that boasted 10 ships and 960 men.15 Though their fleets
were not as massive, eighteenth-century pirates also “cheerfully joined
their Brethren in Iniquity” to engage in multicrew pirating expeditions
(Snelgrave 1734, 198).
III.
A.
Merchant Ship Organization
Efficient Autocracy
Although some pirates came from the Royal Navy, most sailors who
entered piracy came from the merchant marine. Merchant ships were
15
In the South China Sea, Cheng I commanded a pirate confederacy that boasted an
astonishing 150,000 members (Konstam 2002, 174). Chinese pirates sometimes sailed
together in fleets of several hundred ships.
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journal of political economy
16
organized hierarchically. On top was the captain, below him were his
officers, and far below these were ordinary seamen. This hierarchy empowered captains with autocratic authority over their crews. The captain’s authority gave him control over all aspects of life aboard his ship,
including provision of victuals, wage payment, labor assignment, and,
of course, crew member discipline.
Merchant ship autocracy reflected an efficient institutional response
to the specific economic situation these ships confronted and, in particular, the ownership structure of merchant vessels. Merchant ships
were owned by groups of typically a dozen or more landed merchants
who purchased shares in various trading vessels and financed their voyages.17 In addition to supplying the capital required for ships’ construction and continued maintenance, owners outfitted their vessels, supplied
them with provisions, advanced sailor wages, and, most important, solicited customers (who were other landed merchants) and negotiated
terms of delivery and freight.
Merchant ship owners were absentee owners of their vessels; they did
not sail on their ships.18 They were landlubbers. Most merchant ship
owners did not desire to take their chances with brutal life at sea, and
in any event could earn more by specializing in their area of expertise—
investment and commercial organization—hiring seamen to sail their
ships instead.19
Because they were absentee owners, merchant ship owners confronted
a principal-agent problem with respect to the crews they hired. Once a
ship left port it could be gone for months.20 At sea, the owners’ ship
was beyond their watchful eyes or reach. Thus, ship owners could not
directly monitor their sailors.
This situation invited various kinds of sailor opportunism. Opportun16
Navy ships were also organized hierarchically. Their captains were commissioned by
the Admiralty (typically on the recommendation of superior commissioned officers) and
had command over crew activities, power to physically punish sailors (or to direct/authorize lower-ranking officers to do so), etc. Captains of larger naval ships did not, however,
have control over victuals, which were instead controlled by a warrant officer called the
“purser.” The purser’s logs, which documented victuals distributed, were often approved
by the captain.
17
Ownership groups were sizable because of the need to diversify the risk of merchant
shipping. Each merchant purchased a small share in many ships rather than being the
sole owner of one.
18
Because most merchant ships were owned by groups of investors, even in cases in
which a merchant captained his vessel himself, there remained absentee owners, his coinvestors.
19
Absentee ownership was further assured by the fact that the members of merchant
vessel ownership groups engaged in many more commercial activities besides their concern
in a particular merchant ship. These other commercial activities often required merchants
to be on land to tend to their affairs rather than at sea.
20
Although merchant ships engaged in coastal trade were at sea for shorter periods,
merchant ships engaged in long-distance trade could be gone for periods of nine months
or more.
law and economics of pirate organization
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ism included negligence in caring for the ship, carelessness that damaged cargo, liberality with provisions, embezzlement of freight or advances required to finance the vessel’s voyage, and outright theft of the
vessel itself.
To prevent this, ship owners appointed captains to their vessels to
monitor crews in their stead. Centralizing power in a captain’s hands
to direct sailors’ tasks, control the distribution of victuals and payment,
and discipline and punish crew members allowed merchant ship owners
to minimize sailor opportunism. As noted above, merchant ships tended
to be quite small. Consequently, captains could cheaply monitor sailors’
behavior to prevent activities (or inactivities) that were costly to ship
owners and secure sailors’ full effort.21
Admiralty law facilitated captains’ ability to do this by granting them
authority to control their crews’ behavior through corporal punishment.
The law empowered captains to beat crew members with the infamous
(and ominous) cat-o-nine-tails, imprison them, and administer other
forms of harsh physical “correction” to sailors who disobeyed orders,
shirked in their duties, and so forth. It also permitted captains to dock
sailors’ wages for damaging or stealing cargo and insubordination.
To align owner-captain interests, owners used two devices. First, they
hired captains who held small shares in the vessels they were commanding or, barring this, gave small shares to their captains who did
not. Merchant ship captains continued to draw regular fixed wages like
the other sailors on their vessels.22 But unlike regular sailors, captains
became partial residual claimants of the ships they controlled, aligning
their interests with those of the absentee owners.23 Second, whenever
21
In addition to using autocratic captains to cope with this principal-agent problem,
merchant ships also held back a portion (or sometimes all) of sailors’ wages until a voyage
was complete.
22
A few merchant ships engaged in part-time fishing used a share system of payment
similar to the one privateers, whalers, and pirates used. However, the overwhelming majority of merchant ships used a fixed wage system. In vessels engaged in coastal shipping,
sailors were paid lump-sum wages. In vessels engaged in long-distance shipping, sailors
were paid monthly wages.
23
The owner-sailor principal-agent problem could not have been overcome by converting every crew member’s fixed wage to a profit-sharing scheme. Even under profit
sharing, sailors would still have an incentive to consume cargo, liberal provisions, etc.,
and then blame the loss on the uncertainties of the sea, such as pirates or wrecks. Although
this opportunism would reduce each sailor’s share of the voyage’s net proceeds, since the
cost of such behavior is borne partially by the absentee owners, sailors have an incentive
to act opportunistically. Further, converting sailor wages to shares would not have deterred
the crew from the most costly kind of opportunism—absconding with the ship and its
freight. Because the benefit of such theft would exceed the crew’s fraction of a successful
voyage’s proceeds, which are shared with the absentee owners under a profit-sharing
scheme, without an authority to monitor and control their behavior, crews would still have
an incentive to steal the ships they sailed on. This is why both privateers and whaling
ships, e.g., which used a pirate-like profit-sharing system but also had absentee owners,
still required and used autocratic captains. On the efficiency of the fixed wage system for
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journal of political economy
possible, absentee owners appointed captains with familial connections
to one of the members of their group (Davis 1962, 128). This ensured
that captains did not behave opportunistically at the absentee owners’
expense since, if they did, they were more likely to face punishment.24
The reason merchant ship owners required autocratic captains to effectively serve their interests is straightforward. A captain who did not
have total authority over his crew could not successfully monitor and
control sailors’ behavior. Reducing the captain’s power over victuals,
payments, labor assignment, or discipline, and vesting it in some other
sailor’s hands instead, would have concomitantly reduced the captain’s
power to make sailors behave in the absentee owners’ interest.
Similarly, if merchant ship owners did not appoint their captains as
the permanent commanders of their voyages, but instead permitted a
ship’s sailors to popularly depose the captain and elect another member
of the crew to this office at their will, the captain’s capacity as acting
manager of the ship’s absentee owners would cease to exist. To see this,
simply imagine what kind of captain merchant sailors would elect if
given the power to democratically select him. Sailors’ interests were best
served by a lax, liberal captain who let them do as they pleased—exactly
the opposite sort of captain that best served the owners’ interests. Merchant ship autocracy was therefore essential to overcoming the ownercrew principal-agent problem and thus to merchant ship profitability.
Merchant ship autocracy worked quite well in this respect. Although
some sailors still managed to steal from the ships they sailed on, disobey
command, and, as I discuss below, in several cases mutiny and abscond
with the owners’ ship, these were relatively unimportant exceptions to
the general rule whereby merchant sailors, under the authority of autocratic captains, served their absentee owners’ interests.
B.
The Problem of Captain Predation
Although merchant ship autocracy largely overcame the principal-agent
problem that absentee owners confronted with respect to their crews,
in doing so it created potential for a different kind of problem: captain
predation. The trouble was that a captain endowed with the authority
required to manage his crew on the ship owners’ behalf could also easily
turn this authority against his seamen for personal benefit. As British
the merchant marine and efficiency of the share system for privateers and whalers, which
also applies to pirates, see Gifford (1993).
24
A third device owners used for this purpose, though of declining importance over
time, was that of the supercargo—an agent hired by the ship’s owners who sailed on the
ship and managed commercial aspects of the voyage, such as buying and selling cargo at
port, and sometimes deciding what ports the ship should stop at, when the captain could
not be trusted in these capacities (Davis 1962).
law and economics of pirate organization
1059
marine commander William Betagh characterized the problem, “unlimited power, bad views, ill nature and ill principles all concurring” “in a
ship’s commander,” “he is past all restraint” (1728, 41).
Betagh’s opinion of some captains’ “ill nature” notwithstanding, merchant captains were not necessarily bad men. But they were rational
economic actors and thus responded to the incentives their institutional
environment created. Endowed with autocratic authority over their
crews, some merchant captains used the power their employers and
Admiralty law gave them to prey on their sailors. As a result of merchant
ships’ autocratic organization, captains “had absolute authority over the
mates, the carpenters and boatswain, and the seamen.” They had the
power to “make life tolerable or unbearable as they wished” (Davis 1962,
131–32). Unfortunately for seamen, more than a few captains opted for
the latter.
As Marcus Rediker points out, according to several pirates, merchant
captain mistreatment of ordinary seamen was largely responsible for
driving sailors from this profession into the arms of sea bandits. The
pirate John Archer’s last words before being put to death testify to this.
As he lamented, “I could wish that Masters of Vessels would not use
their Men with so much Severity, as many of them do, which exposes
us to great Temptations” (Johnson 1726–28, 351). In 1726 the pirate
William Fly pleaded similarly while awaiting his death sentence: “Our
Captain and his Mate used us Barbarously. We poor Men can’t have
Justice done us. There is nothing said to our Commanders, let them
never so much abuse us, and use us like Dogs” (quoted in Rediker 1981,
218).
Captain predation took a number of forms, each the result of abusing
the autocratic power captains had at their dispos