John Adams, Thomas Jefferson, and the Barbary Pirates: An
Illustration of Relevant Costs for Decision Making
Dennis Caplan, Assistant Professor
Iowa State University.
The concepts of incremental cost, opportunity cost, sunk cost,
and cost allocation are identified and discussed in the context of
early U.S. foreign policy. The case is derived from an authentic
exchange of views between Thomas Jefferson and John Adams about how
the United States should protect its merchant shipping against the
Barbary pirates. Both men compare...