Landon Johnson

Dr. Platt

Econ 110 Book Essay 1

15 Sep 2020

Effects of Piracy on the Wealth of Nations

In his book New Ideas from Dead Economists, author Todd G. Buchholz tiptoes lightly

around a truly fascinating topic: piracy. While summarizing early colonial mercantilism,

Buchholz leaves a crumb trail leading the reader to some serious food for thought, “Even the

defeat of pirates contributed to the wealth of nations.” Upon re-reading this subtle yet weighty

claim, one is left longing for understanding, combing the chapter to no such avail. Luckily, a pair

of brilliant Harvard economists, Rodolphe Durand and Jean-Philippe Vergne, equally enthralled

by this idea, published an analysis–originally in French–titled L’Organisation Pirate: Essai sur

l’évolution du capitalisme, providing much needed insight.

Piracy has plagued the proprietary business owner and entire nations alike for centuries,

in its wake leaving lost revenue, upset strategic advantage, infringement of rights, and even

horrible violence; albeit many of these dark tales having only been romanticized of late.

Examples include modern entertainment pieces detailing a traditional view of the notoriously

scurvy seamen such as in Peter Pan and The Pirates of the Caribbean. These films correctly

portray pirates as bloodthirsty buccaneers. However, they simultaneously fail to educate the

viewers on the true everlasting economic effects of these pirates’ cunning and ruthless reign on

the high seas of the mid-Atlantic trade triangle.

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In the golden age of mercantilism, European countries competed for colonial power and

sought ranks through the trade of goods for precious metals. Consequently, mixed international

trade–a trademark of modern capitalism–was heavily avoided, tariffed, and capped (Durand).

Most trade went through a market in the Caribbean islands which was far less regulatory, and

more profit driven. Thus, this area made for both a safe harbor and a perfect choke point for any

privateer-businessman willing to exploit the vulnerability of others. Pirates in this time were well

educated, usually gaining their sailing expertise on small fishing boats or merchant ships. They

democratically appointed a captain, tediously organized attack plans, and lived strictly by an oath

of brotherhood. These bandits of the sea were too smart to attack treasure, naval, or government

ships; they preyed upon merchant ships, utilizing scare tactics to easily confiscate surrendered

goods and capital (Jacque). They avoided violence but were all but hesitant to resort to it.

As piracy in this age forced intercolonial and international trade through black markets,

early economists began to see the effects of comparative advantage and opportunity cost. With

the rise of modern-day capitalism, the wealth of nations increased, leaving behind mercantilism

and consequently, ‘sea dog’ piracy in its path. Or did it…?

A rise in technological piracy has swept over the world in the last few decades, ushering

in a new type of individualistic commercialism and entrepreneurship. In today’s day and age,

anyone can get rich and famous fast, regardless of age or education. Supply and demand reward

the best product at the lowest price; instantaneous worldwide communication provides an infinite

market that connects buyers and sellers. Technological piracy has led the way for forcing

innovation, improving cybersecurity, and expanding capitalism to undeveloped markets. When

an idea, product or process is stolen, a better one is forced to be created.

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Works Cited

Durand, Rodolphe, and Jean-Philippe Vergne. “No Territory, No Profit.” Research Gate, AIMS,

Mar. 2012,

www.researchgate.net/publication/271317826_No_territory_no_profit_The_pirate_organiz

ation_and_capitalism_in_the_making.

Jacque, Brian W. “Piracy in a Mercantilist Society.” History Files, Western Oregon University,

Aug. 2015, wou.edu/history/files/2015/08/Brian-Jacque.pdf.