Bolivia as "rentier state"?

05.01.2006

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Continuing from the previous post, I thought I'd pass along a thought by another blogger: the idea of Bolivia as a rentier state.

Rentier states are states that use state-owned resources as political tools (see Wikipedia article). Historically, rentier states have done poorly in terms of long-term economic development (not to mention democratic consolidation). Why? Because the state can use nationalized industries as virtual slush funds to distribute resources to loyal followers (read: corruption, clientelism) w/o really developing the country's economic or civil society. It works fine for a while. But as soon as the resource runs out (or its price declines in the international market), things just completely fall apart. The state no longer has a cash cow to reward loyalists & retain public spending, but it has deliberately destroyed private economic society & civil society (including independent political parties or civic associations).

For an example of a rentier state, see Douglas Yates, The Rentier State in Africa: Oil Rent Dependency & Neocolonialism in the Republic of Gabon.

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UPDATE: For a critical view on "rentier states" see this article by Thandika Mkandawire.

Posted by Miguel at 11:25 PM