by Daniele Archibugi

Anyone who thought that the history of piracy was now something out of a Hollywood movie has had to think twice. The events in the Gulf of Aden lead us to wonder what differences there are between ancient piracy and the modern version. Perhaps if we examine the piracy that reached its peak between the end of the seventeenth and the early eighteenth century, and preyed on the major trade routes, we may get a clearer understanding of modern piracy. However, opportunity makes men thieves and the cleverly written and witty book by Peter T. Leeson, The Invisible Hook. The Hidden Economics of Pirates (Princeton University Press, Princeton, 2009), enables us to do so.

U.S. navy capturing suspected pirates in the Gulf of Aden, May 2009. (U.S. Navy photo, public domain)

According to Leeson, pirates applied economically rational principles aimed at obtaining the maximum result with the least effort and above all minimum risk. They too, in other works, apply the rules of Adam Smith’s invisible hand, or rather the invisible hook. Pirates were not cruel out of sadism but simply because by spreading terror they were able to increment their booty. Flying the infamous “Jolly Roger” served the purpose of generating what economists call the “announcement” effect: the potential victims were warned that any attempt to stave off the attack by a pirate vessel would lead to ferocious reprisals. If, on the other hand, the vessel attacked surrendered without any resistance, everything of value on board would be seized but the crew would be spared. The same applies to the pirates’ widely publicized ruthlessness against prisoners: many of the latter were tortured, others forced to walk the plank. Also in this case the pirates’ intention was to create what economists call the “reputation” effect. Prisoners might try to conceal information about valuable goods or about the routes followed by other trading or navy vessels and would be induced to reveal all their secrets by the terrible reputation enjoyed by the pirates.

Leeson gives credence to the economic interpretation of the pirates’ behavior: mutineers were certainly attracted by high profits; in the early 18^th century a sailor of a merchant vessel earned no more than 25 pounds a year, and a courageous pirate could earn as much as 300. But as well as borrowing from the trappings of economic theory, Leeson does not disdain also casting a penetrating glance at the social and political motives of these odd outlaw communities. Life on board ship, whether a merchant or a navy vessel, was regulated in an authoritarian and hierarchical fashion (and it might be added that things have not changed much since those times). The ship’s commander had the power to inflict very severe corporal punishment, stop crew members’ pay without good reason and demand that the crew perform work not envisaged in the original contract, and more besides. On board the captain had the power of life or death without any checks or balances. It is true that the sailors could sue for justice in the courts on returning home, although the latter usually sided with the commanders, also because the judges came from the same social class.

It is thus not surprising that, far beyond the reach of the dominant authority on land, sailors should set up a completely different social organization. And it is striking to see the extent to which this was based on principles of equality. In the first place, political equality. “Every Man has a Vote in the Affairs of the Moment” runs article one of the Code of Conduct on board the private vessel of Captain Bartholomew Roberts. Furthermore, it was the crew members who elected their own captain. Furthermore, the commander could be deposed by the pirates themselves if judged to be inadequate, corrupt or not bold enough, as happen to the famous Captain Edward England. In the rudimentary system of checks and balances characterizing the pirate republics, also a quartermaster was elected to look after the ship’s management, and who had the power to avoid individual crew members being unjustly punished. Nor must it be overlooked that, in an era in which the European nations were getting rich from the slave trade, many pirate ships granted equal rights also to colored men.

The pirate communities were in other words far from being anarchic: indeed, they developed a democratic system opposed to the autocratic system prevailing in the other vessels. Pirates had even too many rules: their codes of conduct prohibited sailors from gambling and smoking on board, from drinking after sunset and from keeping lamps alight late at night. They were also prohibited from bringing women on board to avoid causing jealousy.

The distribution of the rewards was much fairer than the pay on merchant or naval vessels: the pay of the captain and the quartermaster was only twice as high as that of ordinary pirates. Moreover, in the case of accidents in the “working place”, the pirates’ republics had a much more highly developed welfare system than that applied on the other ships: they meticulously specified how much was due to any crew member who had lost a hand, a leg or an eye. On the other hand, desertion during a boarding operation was punished by death or marooning on a desert island.

If piracy offered so much more to its members than was available to other sailors, the question is not so much why there were so many (it is estimated that there were two or three thousand in the early 18^th century) but rather why so many sailors did not become pirates. Perhaps it is because when captured they were almost always hanged: a count of executions between 1716 and 1726 indicates that about 400 were hanged, about 40 per year on average. But if we consider the high death rate among law-abiding sailors it must be concluded that the “announcement” and the “reputation” effects worked more for the scaffold than for the Jolly Roger.

Peter T. Leeson: The Hidden Economics of Pirates
Princeton University Press, Princeton 2009.
ISBN-13: 978-0691137476
Hardcover, 296 pages, US$24.95

Daniele Archibugi is director of the Italian National Research Council (CNR), and professor of innovation, governance and public policy at Birkbeck College.

This article first appeared on openDemocracy.net ; it is here republished under a Creative Commons Licence.

By Gloria Origgi

In one of his perfect narratives, Heinrich von Kleist tells the sad story of two secret lovers separated and condemned to death just before the earthquake that was to destroy Santiago de Chile in 1647. Having miraculously survived, they enjoy for a few days the mercy of an enchanted social atmosphere. Their judges and executioners, transformed by the tragedy and the ensuing chaos, multiply gestures of altruism and generosity. The blissful mood persists for a short while, but soon the rules and norms of civil life are being reinstated and a Mass is celebrated during which the crime of the two poor lovers is denounced as the cause of all the evil. The lovers, unable to escape the fury of collective condemnation, are clubbed to death. The reciprocal altruism and the disinterested society that the cataclysm had spawned turns out to be ephemeral, unnatural, as if the ferocious end were a way to compensate for the uncanny sense of self that the people had experienced when acting in such a disinterested manner.

Jon Elster’s latest book, Le désintéressement, based on his Collège de France lectures in 2006-2007, discusses the very possibility of disinterested action. Is it possible for a human being to act in a truly disinterested manner? Do disinterested actions have a psychological unity or are they the mere product of circumstances? Is disinterestedness an individual or a collective phenomenon?

From a strictly rational point of view, that of utilitarian economic rationality, to the critique of which Elster had devoted an important part of his work, disinterestedness looks irrational. It violates the rules of maximisation of utility. As if human action without the kind of rational and interested motivation that optimise the individual utility was bereft of justification, irrational or at least arational. Elster’s aim, in this first volume of a trilogy that will be dedicated to the critique of the classical theory of Homo Economicus, is precisely to combine a critique of the motivational model of interest with a methodological individualistic approach, and not to go along with holistic explanations in terms of superstructure characteristic of other social science traditions such as Marxism and structuralism. Pierre Bourdieu for instance reduces the possibility of disinterested action to the social mechanics of distinction, assuming that it only occurs as a means of increasing one’s symbolic capital in an economy where not all exchanges are material. Elster, on the contrary, seeks individual motivations for disinterested acts, disinterested reasons to act that are moreover independent of the social superstructure.

There are two defining features of Homo Economicus that disinterested actions may undermine: rationality and interested motivation. Elster’s approach saves rationality at the expense of interested motivation. Actually, if classical economic theory insists on the univocity of interested motivation, it is first and foremost for reasons of simplicity and elegance. Leaving out interest, the theory gets lost in a thousand directions since, writes Elster paraphrasing Tolstoy, “if all interested agents are interested in the same manner, disinterested agents are so each in its own way.” Still, rational choice theory is so equipped that, while it could not do without the presupposition of rationality, it could do without interested motivation.

So Elster, equally familiar with French XVIIth century moralists and with current experimental research in behavioural economics, gives up on a univocal explanation and sketches a taxonomy of disinterested motivations that are, all the same, rational. Altruistic and disinterested action is typically suspected of having in fact other motivations: self-pride, desire for the approval of others, awareness of the benefits of a good reputation. To these essentially ‘allocentric’ social motivations that could be reduced to a form of indirect egoism, Elster adds motivations that are not egoistic but that may be ‘egocentric’, for instance: 1) disinterested consideration for others’ welfare (altruism, egalitarianism, everyday Kantianism), and 2) internal approval of disinterestedness, that is, the desire we have to appear, in our own eyes rather than in the eyes of others, as motivated by disinterested consideration of the interest of others. For Elster, these motivations are independent of the mechanisms of social recognition and intrinsically disinterested.

A series of case studies complements conceptual analysis: the mechanisms of disinterest are being brought to light in behavioural economics experiments on cooperation and reciprocity, and people are shown not to maximize their own utility in exchanges, in intergenerational donations, in reparation among countries, in decision processes in assemblies, and in the motivation of kamikaze terrorists, all cases that Elster had analysed in previous work.

The wide range of phenomena analysed and of explanations is typical of Elster’s style, who, to reductionist social sciences that aim at being “exact”, opposes a model of vectorial explanation that proceeds by articulating a variety of causal mechanisms. There remains a doubt regarding the unity of the phenomenon: if so many forms of disinterestedness are possible, and so many different motivations may underlie it, are we still talking about one and the same thing? Is there then a unitary theory, a mechanism that explains in an integrated way this “ivresse du désintéressement,” and that provides the phenomenology of this ecstatic freedom from our egoistic drives, that Kleist illustrated so clearly with a few strokes.

Jon Elster: Le désintéressement. Traité critique de l’homme économique (tome I)
Seuil, Paris 2009
ISBN-13: 978-2020965903
Paperback, 376 pages, 23 EUR

Gloria Origgi is a philosopher and a researcher at the Centre Nationale de la Recherche Scientifique in Paris. Her most recent book is on the issue of trust as a philosophical problem (Qu’est-que la confiance? Vrin, Paris 2008).

A version of this article, with minor modifications, was first published on the website www.cognitionandculture.net under a Creative Commons Licence (which also applies to the present article); reproduced with permission of the author.