Informal Regulation: An Economic Perspective on the Private Security Industry

Abstract

The literature on military privatization is predominantly skeptical about the possibility of successfully providing military security through private companies. Most scholars argue that without a much stricter and more comprehensive system of formal regulations, the use of private actors to provide security would be too risky. Their argument is based on the assumption that private actors in military roles have greater incentives to behave in potentially harmful ways than their institutional counterparts in the state organized military. (Singer 2003a: 151)

The author would like to thank Prof. Christopher Dandeker for his useful suggestions and comments to this article.