Unpacking the Political Resource Curse: How Oil Fuels Personalism and Undermines Democratization

Abstract

Oil wealth is often associated with prolonged authoritarian rule, poor governance and other institutional pathologies. These unusual effects of petroleum have been variously described as the 'Paradox of Plenty' (Karl 1997), 'Natural Resource Trap' (Collier 2007), and the 'Oil Curse' (Ross 2012), and an increasing number of studies have examined the causes and effects of the oil curse (Humphreys et al. 2007). However, the prevailing assumption in most studies has been that oil will have an equally strong anti-democratic effect across authoritarian regime types (Ross 2001; 2012; Jensen and Wantchekon 2004; Haber and Menaldo 2011). Theoretical and empirical studies on the resource curse have ignored institutional differences in authoritarian rule emphasized by scholars of authoritarian politics (Linz and Stepan 1996; Geddes 1999; Schedler 2009; Geddes, Wright and Frantz 2014). In this study, I combine these two strands of literature and show that oil has a particularly dire effect on the democratization prospects of a particular subtype of authoritarianism, namely, personalist autocracies. The analysis of regime development patterns across oil and non-oil producing states presented in this study shows that oil wealth particularly strongly harmed democratization prospects in the personalist sub-set of authoritarianism. Using three country-case studies of Azerbaijan, Cameroon, and Venezuela, I illustrate the ways in which oil can reinforce personalism and undermine the democratization processes and suggest that the causal channels linking oil and regime outcomes (authoritarian durability and democratic transitions) depend on the composition of authoritarian rule in place, and may not be uniform across regime types. The case of Venezuela under Chavez also indicates that in democratic regimes with a long history of oil-induced elite corruption, oil wealth may contribute to the personalization of power in a failing democracy.