It looks like a pen flare initiator however there's a pocket clip on it, which I have never seen. If it is the initiator, then it will shoot pen flares and set off shot gun primers for you. They're great for initiating shock tube/NONEL. Looks a little old though :)
Yeah I noticed your trigger haha. Nothing but a spring loaded firing pin inside of a case. Simple and effective. Have fun! Make sure plenty of alcohol is involved :)The "knob" half way down is the trigger, found it at my dad's;so no telling how old it is. Guess I need to find some flares to play with (HH6 will shit a brick on this, LOL).
Check with your Coast Guard friends they still issue them for their life vests.
Work very well not so much with alcohol involved. or in my case not with alcohol.