Maritime piracy is a growing scourge on the international community-imposing large costs on maritime states and industries, as well as potentially undermining state capacity and funding terrorism. Using original data on over three thousand pirate attacks, we argue that these attacks are, in part, a response to poor labor market opportunities. To establish this, we take advantage of the strong effect of commodity prices on labor market opportunities in piracy-prone states. Consistent with our theory, we show that changes in the price of labor and capital-intensive commodities have consistent and strong effects on the number of pirate attacks in a country's territorial waters each month. We confirm these results by instrumenting for commodity prices using monthly precipitation levels.While conjuring images of cannons and tattered sails, piracy is also a modern scourge-and an increasingly costly as well as common one. Besides the costs of theft, sabotage and ransoms from hijackings, piracy delays shipping, drives up security costs, hinders development in coastal states and is a potential source of funding for terrorist groups, insurgents and international criminal organizations (Luft and Korin 2004;Murphy 2007; Lehr 2006). Furthermore, the number of pirate attacks (worldwide) reported by the United Nations' maritime branch-the International Maritime Organization (IMO)-has increased by more than 50% in the past five years.We argue that economic conditions play an important role in driving this variation. We argue that pirates take into account the rewards they might achieve through labor in alternative, presumably legitimate, activities when deciding whether or not to engage in piracy.In making this argument, we situate pirate groups within a larger class of predatory groups that include criminal organizations and some insurgent and terrorist groups. Like members of these groups, individual pirates balance the rewards from predatory behavior with benefits of legitimate employment and the risks of capture and punishment (Becker 1968).We therefore expect that the number of pirate attacks is not just a function of how much pirates can earn from predation, but is also a function of how much pirates can earn in other labor-intensive sectors. This paper offers multiple contributions to an emerging empirical literature on piracy (Hastings 2009;de Groot et al. 2011; Shortland and Vothnecht 2011). While some have suggested poverty plays a role in piracy, this is the first paper to explicitly test the role of labor opportunities in driving the decision to engage in piracy. In addition, this paper is among the first attempts to explain temporal variation in pirate attacks, and to use a causally motivated empirical strategy to test for a link between labor opportunities and piracy.There is also a growing literature addressing the effect of labor incentives, poverty and resource scarcity on predatory behavior more generally. Financial incentives appear play a role in both the attack and recruitment activities of terror...
The People's Action Party (PAP) of Singapore is one of the world's longest ruling dominant parties, having won every general election since the country's independence in 1965. Why do Singaporeans consistently vote for the PAP, contrary to the expectations of democratization theories? We argue that valence considerations—specifically, perceptions of party credibility—are the main factor in the voting behavior of Singapore's electorate, and are critical to explaining the PAP's resilience. Furthermore, we argue that the primacy of valence politics arose in part by design, as the PAP has used its control of Singapore's high-capacity state to reshape society and thereby reshape voter preferences towards its comparative advantages. We use a multi-methods approach to substantiate this argument, including a comprehensive quantitative analysis of recent elections. Ultimately, our findings suggest that a focus on valence politics can increase the resilience of dominant parties, but that such a strategy also faces natural limits.
Transnational crime brings substantial foreign capital into a number of fragile and developing states. Yet the economic and political impacts of such capital have rarely been studied due to the challenges of obtaining accurate data on illicit activities. We overcome this challenge by compiling a dataset on the amount and disbursement dates of ransom payments made by ship owners and insurers to Somali pirates from 2005 to 2012, along with sub-national commodity prices and trade flows in Somalia. Using a difference-indifferences strategy, we hypothesize and find that ransoms have effects similar to those associated with the Dutch Disease. These effects include appreciating the local currency, decreasing export competitiveness, and increasing import dependence. The results illuminate a new channel through which illicit capital can undermine long-term economic development and foster an economic and political dependency on illicit sectors.
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