Everything I Know About Management, I Learned From Pirates


Who would have thought that pirates could be a good source of study for organizational behavior? It's true. A paper that came out this month analyzes the organizational structure of pirates.

This paper investigates the internal governance institutions of violent criminal enterprise by examining the law, economics, and organization of pirates. These most treacherous rogues terrorized the waters of the Caribbean, Atlantic, and Indian Oceans during the 17th and 18th 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 to overcome these obstacles to successful organization. First, I look at 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. Remarkably, pirates adopted both of these institutions before the United States or England.

So Jimmy Buffet's A Pirate Looks At 40 is really a song about business?

Thanks to Matt Demeusy for the pointer to the original post.

  • COD

    I saw a history channel documentary on pirates this weekend that made the same point. Pirate ships were essentially democratic in that the Captain served at the pleasure of his crew. If they failed to make enough loot or he otherwise pissed them off, he was essentially voted off the boat.

  • Alex

    For those who liked this paper, Professor Lesson also has a second installment that he put up yesterday entitled “Pirational Choice: The Economics of
    Infamous Pirate Practices.” He also plans to have a third paper out.


  • DJM

    Its nice to see more academics looking to history/non-traditional orgs for business models. I guess this kinda falls in line with the Steve Levitt — why drug dealers live at home view of fun, creative economics investigations. Was this timed with Pirates 3?

  • I think people with the drive to achieve the same goal are inclined to serve with respect. Though it may be common for greedy people to cross the line for their sake, it wouldn’t be logical for pirates to be disorganized because they all live in one ship.

  • True. It’s only important for them to cooperate in order to be successful in their goals.
    It would be impossible for them to organize an assault if they have thoughts about captain predation.