Hierarchies or Markets? The Survival of POWs during WWII

Using a database of virtually all American prisoners of war (POWs) during World War II, we examine for the first time how hierarchy affects success. Survival declines as the hierarchy of a prisoner’s group more closely matches the military population or becomes steeper. Those in the most hierarchical groups were 20 % less likely to survive than those in the least hierarchical groups. This holds for alternative groupings of prisoners and for both Germany and Japan, even though prisoners of Japan were far more likely to die. It appears that trading among prisoners was beneficial, but the military’s hierarchy impeded markets. JEL Classification: D2