Letters of marque and paid convoy protection

How should letters of marque and other auxiliaries be used in the age of sail?

Let privateers hunt for prizes with minimal control, while employing convoy auxiliaries under the commodore and rewarding safe merchant arrivals.

Privateers with letters of marque sought enemy commerce for prize money. Letting them choose their opportunities reduced the need for the state to pay them directly. Closer naval control would create expectations of payment and weaken the point of that arrangement. Hired convoy auxiliaries had a different task and worked with the convoy commodore and naval officers. Payment tied to the merchant ships reaching home gave them an incentive to protect the convoy. The two arrangements rewarded different outcomes: captured enemy ships or safely delivered friendly ones.