Peter Leeson, Economist at GMU and Author of The Invisible Hook: the Hidden Economics of Pirates Urges U.S. Government to Look to History and Economic Theory to Solve the Piracy Problem in Somalia

PRINCETON, N.J.--(Business Wire)--
The daring rescue of Capt. Richard Phillips from imminent harm makes for great
headlines, but few hostages have lost their lives at the hands of pirates in the
waters off Somalia. Though this may seem surprising, economist Pete Leeson says
it makes perfect sense.

"Somali pirates, like their historical brethren, don`t wantonly brutalize
prisoners," notes Leeson. "Simply put, it pays to treat prisoners well. Modern
pirates raise their revenue from ransom, so they have strong incentives to not
misuse their captives."

Short term solutions: weapons and training

There are further lessons to be learned from historical pirates like Blackbeard,
"Black Bart" Roberts, and "Calico" Jack Rackam. Many shipping companies are
undertaking anti-pirate training programs and, in some cases, providing arms to
their crews. According to Leeson, the short term goals of the U.S. government
should include insuring that international and domestic laws are not preventing
commercial vessels from arming themselves as they think appropriate.

"Unclear rules and regulations about the legality of merchant ships carrying
certain kinds of firearms and engaging pirates are not helping the modern pirate
problem. 18th-century merchant ships could and did carry weapons and there is
some evidence that weaponry was a deterrent to pirates," explains Leeson.
"Modern pirates don`t face such deterrents."

And this, according to Leeson, is one of the many reasons why we`ll continue to
see pirate attacks off the coast of Somalia in spite of growing pressure for an
international response.

Long term solutions: privatization of Somali seas

"Piracy problems should be largely self-correcting. It's not that governments
can't stop the pirates. It just isn't worth it for them to do so," says Leeson.
"Although the number of pirate attacks has grown tremendously, the total number
remains low compared to the volume of merchant shipping."

However, history dictates that if the problem grows severe enough, we'll see
steps taken to prevent piracy-perhaps even the privatization of the seas around
Somalia.

"Since nobody owns these waters, nobody has an incentive to prevent hijackings
that occur in them," explains Leeson. "A private owner, in contrast, would
profit from keeping the waters clear of pirates."

http://www.peterleeson.com/

Princeton University Press
Jessica Pellien,609-258-7879
jessica_pellien@press.princeton.edu

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