The Rentier State and the Challenge of Leadership

By Miriam R. Lowi
Submitted to Session P2002 (New Approaches to the Rentier State, 2009 Annual Meeting
Pol Science
All Middle East;
Over the past 25 years, literature on the rentier state has gone through several iterations and the explanatory power of the framework has been called into question on more than one occasion. This paper notes that in studies of the rentier state, explicit attention to one the most critical variables for the determination of (political) outcomes – the decisions of leaders – has been rare. Hence, it sets out to “bring leadership back in” to the study of politics in oil-exporting states. It aims, as well, to resurrect and advance the debate about the relationship between structure and agency, this time with a focus on oil-exporting states of the Middle East.
The paper explores the variation in leadership responses to the 1986 oil shock, when the price of oil plummeted and the domestic political economies of major oil-exporters were, as a result, considerably strained. The paper considers both the variation in leadership decisions at this critical juncture, as well as the variation in their effects in three countries: Algeria, Iraq, and Saudi Arabia. Through across case comparative analysis, the paper makes a two-pronged argument: first, the variation in political outcomes in the 1990s – an Islamist insurgency and civil war in Algeria, inter-state war and domestic unrest in Iraq, relative stability in Saudi Arabia – reflects the variation in leadership decisions in the late-1980s; second, the degree of stability enjoyed by oil-exporting states when economic resources are in woefully short supply is a function of the capacity of leaders to extend political resources to social forces.
Thus, with regard to the relationship between structure and agency, the paper demonstrates that while structural factors (oil price downturn) may indeed strain the domestic political economy, those strains are either mitigated or exacerbated by actors (i.e., political leaders). It advances, as well, the suggestion that ‘investing’ in participatory political structures may be a useful strategy for leaders (of oil-exporting states) to adopt when they are faced with domestic challenges on the heels of economic shocks. The research for this paper draws from the author’s book, currently in press, about the relationship between oil wealth and political instability, and derives from several years of research, including extended interviews in Algeria and Saudi Arabia, and perusal of government documents and policy statements.