In an anarcho-capitalist order, the basic institution would be private defense agencies (PDAs). First, (1) they would protect their clients from violence (security function). According to anarcho-capitalists, the best long-term, profit-maximizing strategy for security agencies would be to protect non-aggressive clients effectively. This could result in a significant proportion of the aggressive PDA’s clients switching to cooperating agencies. Relations between security agencies are best viewed as a series of repetitive exchanges involving relatively small sums, which occur in the absence of a third party enforcing contracts (the state).