Stockades are Captive Control buildings in Tropico 2 that contain and provide resting for captives not currently assigned to jobs, while also emanating a strong sense of order and fear in their area.
All islands start with 1 Stockade by default. If you find that you have too many unemployed captives, it may be worthwhile to build another stockade or use the Free Captive edict on unnecessary captives that just waste resources.