The Politics of Institutional Change in Venezuela: Oil Policy During the Presidency of Hugo Chávez

Abstract

This article explains institutional change in Venezuela's state-owned oil company, PDVSA, and Venezuelan oil policy since the election of Hugo Chávez in December 1998, with a focus on the general strike of 2002 and 2003. Drawing on institutionalist theory and interviews with Venezuelan policymakers, we argue that although PDVSA's organizational culture represented a powerful obstacle to reform, a growing contradiction between widely held societal beliefs and PDVSA's culture created a legitimacy problem that Chávez exploited to undermine the traditional power of the organization. The article will show how this legitimacy issue meshed with class politics to bring about comprehensive institutional change in Venezuelan oil policy. It draws on 21 semi-structured interviews conducted in late 2006 with actors who were directly involved in the management of PDVSA and the development of Venezuelan oil Policy over the last 40 years.