The double-edged sword of incentives

Back in the 18th century, Britain was overcrowded with prisoners

Convicts from Britain were transported to Australia

Rise of crime owning to poverty in overcrowded cities was the main reason

These convicts were usually transported on Hulks( transport ships)

Life on these Hulks was terrible, more than 40% of the convicts died on the way

The captain/owner of the Hulk was paid on per convict basis

More the convicts he carried, more money he minted

However, these convicts were poorly treated during their journey; low rations, unhygienic conditions and cramped quarters

The management wanted to keep the costs low

Over a period of time, the British Government learned about this

They changed the payment system to transport the convicts

Now, the management of the Hulks would be only paid on the basis of per convict that safely landed in Australia

Post this, the number of convict deaths on the hulks dropped by a mere 2%

Nothing changed actually, the Hulk management was now incentivized to cram more convicts on the transport hulks

Towards the beginning of 19th century, all private Hulk ownership was phased out

British Government took the ownership of transporting convicts

Any reflections?

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