When most people think of prison gangs, they think of chaotic bands of violent, racist thugs. Few people think of gangs as sophisticated organizations (often with elaborate written constitutions) that regulate the prison black market, adjudicate conflicts, and strategically balance the competing demands of inmates, gang members, and correctional officers. Yet as David Skarbek argues, gangs form to create order among outlaws, producing alternative governance institutions to facilitate illegal activity. He uses economics to explore the secret world of the convict culture, inmate hierarchy, and...

When most people think of prison gangs, they think of chaotic bands of violent, racist thugs. Few people think of gangs as sophisticated organizations (often with elaborate written constitutions) that regulate the prison black market, adjudicate conflicts, and strategically balance the competing demands of inmates, gang members, and correctional officers. Yet as David Skarbek argues, gangs form to create order among outlaws, producing alternative governance institutions to facilitate illegal activity. He uses economics to explore the secret world of the convict culture, inmate hierarchy, and...

Institutions are the formal or informal 'rules of the game' that facilitate economic, social, and political interactions. These include such things as legal rules, property rights, constitutions, political structures, and norms and customs. The main theoretical insights from Austrian economics regarding private property rights and prices, entrepreneurship, and spontaneous order mechanisms play a key role in advancing institutional economics. The Austrian economics framework provides an understanding for which institutions matter for growth, how they matter, and how they emerge and can change...