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Outlaw Economics: Doing Business on the Fringes of the State. A Review Essay

Published online by Cambridge University Press:  29 March 2011

Sebastian R. Prange
Sebastian R. Prange*
Affiliation:
Zentrum Moderner Orient, Berlin
*
[email protected]
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Extract

History often reveals itself at the margins. Hegemony becomes tangible at its peripheries, claims to legitimacy are most emphatically articulated where challenged, and rules are best observed in their breach. For this reason, historians have long been drawn to the study of border zones where sovereignty was contested or subverted rather than tacitly accepted. This work by historians is complemented by, although rarely integrated with, research in other disciplines—most notably in anthropology, sociology, economics, and political science. Social scientists have been particularly interested in the question of economic organization, of how individuals and groups structure commercial exchanges in conditions of insecure property rights and unreliable recourse to official contract enforcement. Such research is frequently motivated by public policy concerns, especially the complex issue of institution-building in transition economies and so-called crisis states. While generally more circumspect about the prescriptive powers of their discipline, historians will nonetheless recognize that the defining characteristics of a contemporary crisis state—limited authority of a central government, weak institutions, ineffectual bureaucracies, widespread corruption—also apply to most, if not all pre-modern polities. Therefore, the study of actors on the fringes of political and legal regimes holds the potential to produce important theoretical insights into the construction of alternative, private-order institutions that are of significance beyond a particular period, region, or methodology.

Type
Review Article
Information
Comparative Studies in Society and History , Volume 53 , Issue 2 , April 2011 , pp. 426 - 436
Copyright
Copyright © Society for the Comparative Study of Society and History 2011

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References

1 A useful introduction to the underlying conceptual framework of this research from the perspective of an economist is offered in Dixit, Avinash K., Lawlessness and Economics: Alternative Modes of Governance (Princeton: Princeton University Press, 2004)Google Scholar.

2 The literature describes such states by a multitude of labels (“failed,” “fragile,” “weak,” “rogue,” etc.) and measures their degree of instability through various indices; for a survey, see Francisco Gutiérrez Sanín, “The Quandaries of Coding and Ranking: Evaluating Poor State Performance Indexes,” Crisis States Research Centre (London School of Economics and Political Science) working paper, series 2, no. 58 (Nov. 2009).

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6 See, for instance, Benton, Lauren, A Search for Sovereignty: Law and Geography in European Empires, 1400–1900 (Cambridge: Cambridge University Press, 2010), 112–20Google Scholar; Thompson, Janice, Mercenaries, Pirates, and Sovereigns: State-Building and Extra-Territorial Violence in Early Modern Europe (Princeton: Princeton University Press, 1994), esp. 21–42Google Scholar; and Heller-Roazen, Daniel, The Enemy of All: Piracy and the Law of Nations (New York: Zone Books, 2009), esp. 77–91Google Scholar.

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9 This point becomes even more apparent from the gang's detailed financial records to which the author became privy; although not described in detail in the book under review, their economic analysis is provided in Levitt, Steven D. and Venkatesh, Sudhir A., “An Economic Analysis of a Drug-Selling Gang's Finances,” Quarterly Journal of Economics 115, 3 (2000): 755–89CrossRefGoogle Scholar.

10 In the views of gang members and law-abiding citizens alike, the police force seems to have been regarded as little more than just another group of racketeers, which although more numerous and better armed than its competitors played a much less significant role in their daily lives and especially hours of need. This relativism could only have been confirmed by the corrupt and criminal activities of individual police officers that are recounted in the book. For Max Weber's definition of the state as based in a successful claim to a “Monopol legitimer physischer Gewaltsamkeit,” see his lecture “Politik als Beruf” (1919), reprinted in Max Weber Gesamtausgabe, I/17, edited by Mommsen, Wolfgang J. and Schluchter, Wolfgang (Tübingen: Mohr, 1994), 36Google Scholar.

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12 For an excellent case study of this dynamic, see Tagliacozzo, Eric, Secret Trades, Porous Borders: Smuggling and States along a Southeast Asian Frontier, 1865–1915 (New Haven: Yale University Press, 2005)Google Scholar.

13 On efforts to subject the Internet to national laws see, for instance, Kohl, Uta, Jurisdiction and the Internet: Regulatory Competence over Online Activity (Cambridge: Cambridge University Press, 2007)CrossRefGoogle Scholar. For a programmatic discussion of how to resist such endeavors, see Ludlow, Peter, ed., Crypto-Anarchy, Cyberstates, and Pirate Utopias (Cambridge, Mass.: MIT Press, 2001)Google Scholar. These debates also find expression in the current controversy about the legitimacy of publishing classified U.S. government data on the Internet platform Wiki Leaks.

14 This system is strikingly similar to the proposed Book Rights Registry, a private entity to be founded as part of the settlement of a lawsuit by the Authors Guild against Google over its Library Project. The Registry is designed as a database in which authors, publishers, and other rights-holders can enter publication details in order to collect revenues and settle disputes. See http://www.googlebooksettlement.com/r/view_settlement_agreement.

15 Notably, as the author points out, the power of the Stationers' Company's wardens was in some respects greater than that of public officials; they were, for instance, able to enter and search members' homes.

16 Atkyns' campaign is more fully documented in Johns, Adrian, The Nature of the Book: Print and Knowledge in the Making (Chicago: University of Chicago Press, 1998), 304–79CrossRefGoogle Scholar.

17 Augustini, Sancti Aurelii, De Civitate Dei, Dombart, B. and Kalb, A., eds. (Turnholti: Brepols, 1955), vol. 1, book 4, ch. 4Google Scholar.

18 Ibid.

19 Tilly, Charles, “War Making and State Making as Organized Crime,” in Evans, Peter B., Rueschemeyer, Dietrich, and Skocpol, Theda, eds., Bringing the State Back In (Cambridge: Cambridge University Press, 1985), 170Google Scholar.