The limits to democracy posed by oil rentier states: The cases of Algeria, Nigeria and Libya

Abstract

Rentier state theory is a set of ideas about why states with considerable natural resource wealth appear to have very similar economic and political development trajectories. This article looks more closely at the proposition that oil rentier states have specific features that make them unlikely to become consolidated democracies. It narrows down the rentier state framework to three such features: first, that rentier states do not rely on taxation for income and thus are released from democratic obligations to their taxpayers; second, that the state spends oil revenues on placating and repressing its population; and third, that the social structure in rentier states leaves very little room for democratic opposition. In comparing three African rentier states, namely Algeria, Nigeria and Libya, the article finds some sections of rentier state theory to have more explanatory value than others. In all three cases government spending on welfare and repression has helped dampen the pressures for democratization. The social structure argument seems more valid for Algeria and Nigeria than for Libya. In none of the cases does the link between taxation and representation appear to be a significant determinant of regime type. Although the study confirms that oil wealth is associated with autocracy, the causal mechanisms of rentier state theory could benefit from being refined.