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Rentier States Essay

1843 words - 7 pages

Rentier states depend on external sources of income for a large proportion of revenue, as opposed to domestic taxations. Today, the term refers most often to the oil states whose income is derived from the international sale of petroleum . Beblawi's definition of rents is widely followed: rents (1) come from abroad, (2) accrue to the government directly, (3) "only a few are engaged in the generation of this rent (wealth), the majority being only involved in the distribution or utilisation of it" and, (4) 'the government is the principal recipient of the external rent in the economy' . All of the characteristics described above are argued by some to encourage a political environment whereby the ruling entity, predominantly a patrimonial regime, has no accountability; a direct result of its auspicious position of not having to impose high levels of coercion on its population in the form of taxation. A rentier state can therefore be argued to mould the ideal environment for the survival of patrimonial and monarchic regimes due to the fact that 'with virtually no taxes, citizens are less demanding in terms of political participation' , hence allowing these regimes to prosper combined with the utilisation of many other 'state' policies. With principal references to Saudi Arabia and Kuwait throughout my analysis, I shall elaborate on my point and further explain the nature of politics of the oil- producing states, which tend to be a lot more profound than just the notion of rentierism.Before the concept of oil as a major source of income for countries such as Saudi Arabia, these states were pre- dominantly segmented, whereby there was a cluster of small states leading to a fragmented power base that was not very far reaching. The politics of the region included providing citizens with a non- welfare state consisting of no infrastructure and just about protecting them from external threats. Successions were decided through family councils, as the single most influential principle to unite the Saudi Arab family was indeed respect. However, after 1945 Saudi Arabia produced oil in major quantities allowing its development to become very rapid. Ultimately, this led to a windfall wealth of unprecedented magnitude in an extremely short period of time. This wealth over time then allowed Saudi Arabia to become a very rich rentier state and 'in richer rentier states, rents create a larger middle class, pay for schoolteachers, increase per capita GDP, and drive up other measures of development' . According to modern idealists, the bourgeoisie have historically been the class to inflict change and seek political participation upon patrimonial and monarchical regimes, and bring about the wave of democratisation that has engulfed western states and other Middle Eastern states for a countless number of years. However, in Saudi Arabia for example, there are myriad numbers of millionaires and yet the royal family are still in control. This is because a middle class is...

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