Governing criminal markets

The role of private insurers in kidnap for ransom

Dados Bibliográficos

ID6264403
AutoresAnja Shortland (0000-0003-2460-9358, King's College London, autor correspondente)
Ano2018
Volume31
Fascículo2
Páginas341-358
Data de publicação2018-04-01
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoGovernance (JOURNAL)
Identificadores do periódicoISSN: 0952-1895 • E-ISSN: 1468-0491
EditoraWiley (PUBLISHER • GB)
DOI10.1111/gove.12290
OpenAlexW2661602439
IdiomaEN
Citações recebidas6
Referências citadas37

The intersection between the formal and criminal economies presents a range of intractable coordination and enforcement problems. Who orders and facilitates the interactions between private, legal entities, and criminals (potentially) engaged in kidnap for ransom? I analyze the contracts, protocols, norms, and agencies created by insurers to govern this unusual market. Stringent insurance contracts, effective security measures, and orderly resolutions create a profitable market for kidnap insurance. Underwriters manage moral hazard and adverse selection. Business risk consultancies minimize the kidnapping of insured workers, high‐net‐worth individuals, and travellers. Crisis responders ensure that hostages are treated well, keep ransoms moderate and stable, and discourage kidnappers from reneging on agreed ransoms. The state, private sector, and mafias incentivize cooperation and enforce contracts. Understanding this complex polycentric governance architecture is crucial for remedying current trends in “terrorist” kidnap for ransom

Business · Corporate governance · Economics · Incentive · Law and economics · Market economy · Moral hazard · Political science · Ransom · Crime, Illicit Activities, and Governance · Law · Terrorism, Counterterrorism, and Political Violence · Wildlife Conservation and Criminology Analyses · Finance