Sep
26
Rentierism
September 26, 2023 | | Leave a Comment
While the unusual sizing of oil rents are a factor in the damaging political and social outcomes of MENA, factors such as variation in regional population sizes and the effects of repression have vast negative impacts on the political and social sectors of this region.
The relationship between Population sizes and oil rents create a number of issues often to do with the ways in which citizens are controlled within certain regions. For example, if a region has a smaller population, control is much easier because those employed in these nations are foreigners who have no connection to that nation. Them being foreigners grants them no rights in that nation and it’s cheap labor. For those who are citizens, because taxing is minimal if any, their connection to the state itself is low. A lack of taxation means there’s no incentive for the state to do anything about improvements within the country that help with the quality of life and citizens are also deterred from trying. Being that they see no improvement and they don’t directly see the income that their country is receiving, it lends to them staying stagnant. Citizens are less incentivized to actually turn against the government or ask for what they deserve.
The “repression effect”, highlighted by Michael Ross in Does Oil Hinder Democracy, is another factor that may be blame for the damaging effects of these region. He argues that resource wealth has two possible reason that can lead to higher militarized governments. One is purely due to self-interest, authoritarian regimes yearn to defending against popular pressure and will continuously search for that. On the other hand, the second reason is closer linked to the causes resource wealth has on ethnic and regional conflicts. In the case that mineral wealth lies within the boundaries of ethnic or religious minorities then tension can rise and competition for these riches can increase.
With that said, high oil rents are major players in the struggling political and social development of these regions. But that alone doesn’t answer many questions. Having such availability to a resource like oil leads to issues with taxation and a divide between the state and its citizens. RRLP countries have higher state capacities while RRLA countries have lower state capacities. Because RRLP countries have less citizens the money can be used more amongst society and invested back into the state. Whereas, RRLA countries face having a larger population meaning they must focus more on coercive measures which are very expensive meaning the allocation of money is much different. Militarization of governments is one of the methods of repression/coercion. These repressive measures often increase due to regional discourse like with the example of resources being in areas of an ethnic or religious minority group.