In late-nineteenth-century Angola there was a flourishing export trade consisting of beeswax, ivory and wild rubber, for which there was a large foreign (European) demand. These goods were produced by indigenous Africans in the remote interior of west-central Africa. There were two sides to this export-related trade. On one side were middlemen and the European agents who employed them to obtain ivory and the rest from interior producers. On the other side of this trade network were the producers themselves. Middlemen were highly mobile, often armed, and travelled in large caravans. Producers, in contrast, were stationary, often unarmed, and lived in small villages. Middlemen, then, typically constituted the substantially stronger force in the interactions between members of these two groups. Indeed, when they could, caravans of middlemen violently plundered interior producers – stealing instead of trading for the goods they desired. Peaceful trade rather than violent theft, however, characterised the preponderance of these interactions.
In fact, the export trade based on producer–middlemen exchange flourished during this time.
This occurred despite the absence of government in this society. Many of the interior communities of producers were stateless. Even the African ‘kingdoms’ that had more formal rulers were hardly formal from a modern Western perspective. The Europeans (mostly Portuguese) had outposts closer to the coast, but these outposts had no official authority over indigenous communities in the interior. Most importantly, since there was no overarching formal authority to oversee the interactions of individuals from different indigenous or European communities, there existed large ungoverned interstices for the interactions between members of these different groups. Social interaction was essentially anarchic.
In the face of the threat of violent theft that middlemen’s strength superiority presented, producers developed a practice that through expanding use over time was institutionalised without central command to facilitate cooperation with middlemen. Producers had a strong incentive to find a solution to this obstacle to exchange since, by themselves, largely stationary and cut off from global markets, they could earn very little. Interactions with middlemen presented an opportunity for greater profits, but also made them vulnerable to violent plunder.
The practice producers employed for this purpose was credit. Normally we think of credit agreements as the cause of potential opportunism. The separation of payment and provision makes the creditor vulnerable to debtor default. In the context of producer–middleman relations, however, it had quite the opposite effect. The way that credit supported cooperation without command is straightforward. In time t, producers would produce effectively nothing. They would leave wax, rubber, and ivory unharvested. When caravans of middlemen looking for goods to steal travelled to outlying interior producers and came upon a village, they would find little to forcibly take. This was problematic from the middlemen’s perspective, as travelling to the interior could be quite costly.
Producers would then offer middlemen the goods they were seeking on credit. Middlemen would pay up front, and producers would harvest the goods after the middlemen departed. Middlemen would later return in time t + 1 to collect what they were owed. By indebting themselves to stronger middlemen, producers created an incentive for middlemen to avoid physically abusing them and to ensure that other middlemen did not use violence against them. The reason for this is simple: in order to repay what they owed, producers needed to be alive and in good health. The financial health of the middlemen who provided producers goods on credit became linked to the physical health of producers who were their debtors. When middlemen returned to collect on the agreement, all that was on hand to plunder was what they were owed. If they wanted more they could either contract a new round of the credit exchange or leave, knowing that the next time they returned there would again be nothing to take back to their employers for export.
Middlemen frequently chose to renew their credit relationship. In this way, credit emerged as a spontaneous institutional arrangement that prevented violence and enabled both sides to realise the gains from trade, despite the absence of government and the superior strength of some members of society. Notably, these credit arrangements did not create the problem of ex post opportunism on the part of producers, which normally attends credit agreements. Given the superior strength of their creditors, producers knew that, if they failed to deliver, middlemen could easily punish them through their greater strength. Thus, this spontaneous order solved multiple commitment problems that emerge under the social dilemma at once and in each case substituted cooperation for conflict.
El episodio narrado por Leeson pone de manifiesto que la cooperación voluntaria puede sustituir a la violencia mucho más a menudo de lo que el modelo del dilema del prisionero sugiere precisamente porque los individuos no son solo egoístas sino egoístas racionales y su racionalidad les lleva a explotar las ventajas de los futuros intercambios. No cooperar (la estrategia dominante en el dilema del prisionero) es racional sólo si no se incluyen los rendimientos o ganancias de futuros intercambios en el cálculo (si los dos prisioneros no se comunican ni prevén volver a estar en contacto en el futuro. La conclusión es que, aún sin que exista un tercero (el Estado) que garantice el cumplimiento de las promesas, el intercambio voluntario y cooperativo puede florecer.