How non-conformists influence capitalism
Piracy could very well be one of the drivers of capitalism’s growth and evolution, according to Rodolphe Durand and Jean-Philippe Vergne in their book The Pirate Organization: Lessons from the Fringes of Capitalism. Pirates have appeared at major turning points in the history of capitalism: when capitalism began to spread along the trading routes towards the West Indies, when radio opened an era of mass communication, when the Internet became part of the global economy, and when the biotech revolution began.
To support their argument, the authors have adopted a special definition of “pirate”. Humble Somali pirates who rake in mere tens of millions of dollars with their banditry do not qualify. Instead, true pirates have the following characteristics:
- they enter into a conflictive “relationship” with the state, especially when the state claims to be the sole source of sovereignty;
- they operate in an organized manner on uncharted territory, from a set of support bases located outside this territory, over which the state typically claims sovereign control;
- they develop, as alternative communities, a series of discordant norms that, according to them, should be used to regulate uncharted territory; and
- ultimately, they represent a threat to the state by contesting the state’s control and the activities of the legal entities that operate under its jurisdiction, such as for-profit corporations and monopolies.
The authors draw a distinction between pirates, who operate as enemies to all states, and corsairs, who are sponsored by one state but regarded as pirates by other states. Thus Sir Francis Drake was part pirate and part corsair, and Chinese hackers who steal information from Western companies are sometimes corsairs.
According to the authors, the pirates of the Caribbean and Madagascar pioneered a number of important institutions. A pirate captain was elected on the democratic vote of all members of the pirate organization. The captain was in charge of maritime operations, but the quartermaster was in charge of distributing rations and booty and managing conflicts, so that a form of separation of powers existed. Pirate captains did not get preferential treatment; equality prevailed. The wounded were given extra pay, an early form of social insurance. Thus pirates pioneered democracy, separation of powers, equality and social insurance.
The book provides interesting ideas about pirate radio stations and anti-copyright activists, but when Wikileaks and patent trolls are referred to as pirates, the analogy seems to have been stretched a bit too far. Pirates are portrayed more as Gilbert-and-Sullivan-style do-gooders than as the violent aggressors that they always have been and Somali pirates still are. Nonetheless the book contains plenty of thought-provoking discussion about the impact of non-conformist organizations on the evolution of capitalism.