In a fascinating study of Californian prison populations M. Garrett Roth and David Skarbek found that prison gangs actually improve social cohesion amongst inmates.

The two economics professors published their findings in the Wilson Quarterly concluding that gangs actually reduce violence by creating a stable environment in which an internal economy (of contraband) can flourish.

The ‘extra-legal’ framework created by gangs enables agreements to be enforced and social disputes resolved.

“In short,” says their paper, “inmates join gangs to promote cooperation and trust, which facilitates illegal contraband markets. Prison gangs form to provide extra-legal governance in social and economic interactions.”

What this means is that the groups take a level of responsibility of their members. Individuals rocking the boat are dealt with ‘internally’.

The example of a drug deal within the system is given as an example: If a member from gang A buys drugs on credit and then refuses to pay, the drug dealer may appeal to the head of gang A for recompense.

The leader may pay the debt for him and order the defaulter to work off his debt, they may ‘teach him a lesson’ themselves, or they may hand him over to the dealer’s gang – to drive home the message of how important it is to uphold gang A’s honour.

The lessons learned are not confined to the defaulter.

The paper continues, “When groups have reputations for taking responsibility  for its members’ actions, then two members of different groups who do not know each other can still benefit from trade.”

This study points to important consequences for the real world. Individual trade flourishes on the back of social cohesion. This social cohesion is a direct spin-off from high group reputations. And reputation is dependent upon the consistency and fairness of leadership, as much as from their firmness and identity.

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