9 GOVERNANCE AMID THE TRANSITION TO RENEWABLE …
241
for a larger hypothesis regarding the negative development effects of
rentierism. The former, now referred to as the rentier social contract,
is a transactional civic relationship whereby ‘the state provides goods
and services to society (such as subsidies on basic commodities) without
imposing economic burdens, while society provides state officials with a
degree of autonomy in decision-making and policy.’ 7
This channel provided the basis for a theoretical extrapolation to
explain why so many oil-rich states suffered from authoritarianism and
generally negative governance outcomes, such as corruption, bureaucratic
inefficiencies, and targeted repression. The political components were first
explicated by Terry Lynn Karl, who proposes that the characteristics of a
country’s leading export sector tend to influence the state’s capacity to
promote development. 8 Karl argues that a reliance on petroleum, rather
than manufacturing, services, or agriculture, fosters weak institutions that
constrains the state’s ability to adapt to changing economic market conditions—such as the collapse of commodity prices or the expansion of trade
openness. Michael Ross expands this argument to construct a political
theory of the resource curse: resources such as petroleum provide rulers
with revenues for repression, patronage, and the tools to dampen pressures for accountable government. 9 Thus, oil—and natural resources like
it—are posited to hinder democracy and instead provide avenues for the
endurance of authoritarian regimes. 10
This ‘curse’ in political terms therefore seeks to explain why so few
states of the oil-rich Middle East and North Africa did not democratize,
have such long-lasting autocrats, and suffer from bureaucratic inefficiency, corruption, human rights violations, and large-scale censorship
of the press. In economic terms, oil wealth is linked to unemployment,
economic stagnation, stifled innovation, and fiscal imbalances, among
myriad other maladies. Jeffrey Sachs and Andrew Warner set the foundations for the broader study of the economic resource curse by showing
statistical evidence that countries rich in natural resources have systematically lower levels of economic growth than non-resource-rich countries. 11
Their finding led to rigorous scholarly debate questioning the mechanisms
and measures underpinning this correlation—and whether this correlation
is spurious or, if not, whether it only applies to the post-1973 period
once states had nationalized their oil sectors—and whether it applies
to other natural resources, such as metals and minerals. 12 Of particular
relevance to the MENA countries is the investigation of the productivitydamaging effects of resource wealth, whereby commodity booms hinder
241
for a larger hypothesis regarding the negative development effects of
rentierism. The former, now referred to as the rentier social contract,
is a transactional civic relationship whereby ‘the state provides goods
and services to society (such as subsidies on basic commodities) without
imposing economic burdens, while society provides state officials with a
degree of autonomy in decision-making and policy.’ 7
This channel provided the basis for a theoretical extrapolation to
explain why so many oil-rich states suffered from authoritarianism and
generally negative governance outcomes, such as corruption, bureaucratic
inefficiencies, and targeted repression. The political components were first
explicated by Terry Lynn Karl, who proposes that the characteristics of a
country’s leading export sector tend to influence the state’s capacity to
promote development. 8 Karl argues that a reliance on petroleum, rather
than manufacturing, services, or agriculture, fosters weak institutions that
constrains the state’s ability to adapt to changing economic market conditions—such as the collapse of commodity prices or the expansion of trade
openness. Michael Ross expands this argument to construct a political
theory of the resource curse: resources such as petroleum provide rulers
with revenues for repression, patronage, and the tools to dampen pressures for accountable government. 9 Thus, oil—and natural resources like
it—are posited to hinder democracy and instead provide avenues for the
endurance of authoritarian regimes. 10
This ‘curse’ in political terms therefore seeks to explain why so few
states of the oil-rich Middle East and North Africa did not democratize,
have such long-lasting autocrats, and suffer from bureaucratic inefficiency, corruption, human rights violations, and large-scale censorship
of the press. In economic terms, oil wealth is linked to unemployment,
economic stagnation, stifled innovation, and fiscal imbalances, among
myriad other maladies. Jeffrey Sachs and Andrew Warner set the foundations for the broader study of the economic resource curse by showing
statistical evidence that countries rich in natural resources have systematically lower levels of economic growth than non-resource-rich countries. 11
Their finding led to rigorous scholarly debate questioning the mechanisms
and measures underpinning this correlation—and whether this correlation
is spurious or, if not, whether it only applies to the post-1973 period
once states had nationalized their oil sectors—and whether it applies
to other natural resources, such as metals and minerals. 12 Of particular
relevance to the MENA countries is the investigation of the productivitydamaging effects of resource wealth, whereby commodity booms hinder