The Law and Economics of Pirate Organization

From Zero Intelligence Agents:

As the UN, international shipping companies, and the naval forces of the world attempt to address the pirate crisis along the Somali coast, it seemed fitting that a paper land in my inbox addressing the internal dynamics of pirate organizations. Peter Leesoon of George Mason University examines the the organizational structure of pirate groups from the 17th and 18th century in his paper entitled, "An-arrgh-chy: The Law and Economics of Pirate
Organization."

Leeson examines the system of checks and balances used to constrain pirate captains, as well as how these organizations used a form of constitution to create law and order within the organization. The historical perspective presented by Leeson, and the conclusions he draws from an extensive review of historical documents, indicate that pirate organizations were highly sophisticated entities---capable of maximizing profit and minimizing internal conflict through these mechanisms. If pirates groups were able to reach this level of sophistication three-hundred years ago, and given the increasing threat posed by pirates in the waters around the Horn of Africa, it is clearly time to start taking this threat seriously.

Read more ....

My Comment: Bottom line .... the Somali pirates are no longer a nuisance, but a serious threat.