A Paradox of Plenty? Rent Distribution and Political Stability in Oil States

GIGA Working Paper No 21

32 Pages Posted: 19 Jun 2006 Last revised: 16 Aug 2012

See all articles by Matthias Basedau

Matthias Basedau

German Overseas Institute (DUI)

Wolfram Lacher

University of London - School of Oriental and African Studies (SOAS)

Date Written: April 1, 2006

Abstract

Resource curse theory claims that resource abundance encourages violent conflict. A study of 37 oil-producing developing countries, however, reveals that oil states with very high levels of oil revenue are remarkably stable. An analysis of the ways in which governments spend oil revenues identifies two distinct types of rentier systems - the large-scale distributive state and the patronage-based system - which are strongly linked to instability or its absence. However, some deviant cases, such as Equatorial Guinea and Gabon, illustrate the need for further research. Apparently, the notion of a "paradox of plenty" has neglected rentier mechanisms that avoid conflict.

Keywords: Resource Curse, Paradox of Plenty, Oil, Rentier State, Violent Conflict, Political Stability, Developing World

JEL Classification: N5, N 50, O 13

Suggested Citation

Basedau, Matthias and Lacher, Wolfram, A Paradox of Plenty? Rent Distribution and Political Stability in Oil States (April 1, 2006). GIGA Working Paper No 21. Available at SSRN: https://ssrn.com/abstract=909189 or http://dx.doi.org/10.2139/ssrn.909189

Matthias Basedau (Contact Author)

German Overseas Institute (DUI) ( email )

Neuer Jungfernstieg 21
Hamburg, D-20354
Germany

Wolfram Lacher

University of London - School of Oriental and African Studies (SOAS) ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

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