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Home / Amol Agrawal: Mostly Economics / From pecan pralines to ‘dots’ as currency: how the prison economy works

From pecan pralines to ‘dots’ as currency: how the prison economy works

Summary:
Superb piece by Richard Davies (HT: JP Koning blog). Davies tracks the economies and currency markets in prisons in Louisiana (also called as Angola): In many ways, a prison’s official economy is like that of a regular town. In Angola there is a world of work, with jobs and pay, promotions and demotions. And there is a world of shopping, with consumer goods and stores. But prisons are economic systems in which the cost of goods bears no relation to wages or the buying power of the workforce. The most important connections of a market economy – the prices that link work and pay, demand and supply – have been severed, intentionally, by the authorities. The official prison economy exists, but it may as well not, leaving the prisoners to build their own underground markets. In the

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Superb piece by Richard Davies (HT: JP Koning blog).

Davies tracks the economies and currency markets in prisons in Louisiana (also called as Angola):

In many ways, a prison’s official economy is like that of a regular town. In Angola there is a world of work, with jobs and pay, promotions and demotions. And there is a world of shopping, with consumer goods and stores. But prisons are economic systems in which the cost of goods bears no relation to wages or the buying power of the workforce. The most important connections of a market economy – the prices that link work and pay, demand and supply – have been severed, intentionally, by the authorities. The official prison economy exists, but it may as well not, leaving the prisoners to build their own underground markets.

In the underground prison economy, things that might seem simple are hard, and things that might seem impossible can be pretty easy. The case of John Goodlow and his pecans illustrates why. For 20 years Goodlow was the pecan king of Angola, Wilbert Rideau told me. Pecan nuts are grown across the US south, and homemade pecan pralines are a favourite treat in Louisiana. Goodlow made his own – the best ever, said Rideau, “better than outside” – and sold squares of it for $2. He probably could have raised his prices, said Rideau: they were so sought after that Goodlow had often pre-sold a whole batch before he had even finished cooking it.

The fact that making pralines was possible in a maximum-security prison is surprising. Cooking them requires lots of ingredients, as well as pots, a hotplate and an oven. “Prisoners are never powerless,” Rideau said. “They always have the power of rebellion, violence, and just screwing up operations and making life hard for the management.” The power prisoners have means that management often cooperate, and facilitate certain requests, he explained. In prisons, on low-level matters, power is shared, and there is room for simple tradeoffs. So getting hold of a pan can be fairly easy.

But some things that are mundane outside are outlawed in jail. Anything that raises the probability of escape or violence is banned: weapons, drugs, cigarette lighters, mobile phones. But a host of innocent-seeming items are contraband, too: savoury spreads like Marmite contain yeast and can be used in illicit brewing; chewing gum can be used to make an imprint of a key or lock; baby oil can make an inmate’s arms slippery, rendering them impossible to restrain.

The whole thing is quite a read..

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Amol Agrawal
I am currently pursuing my PhD in economics. I have work-ex of nearly 10 years with most of those years spent figuring economic research in Mumbai’s financial sector.

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