Scholars writing in the "resource curse" literature have long argued that oil wealth leads to autocracy. A number of theories have been offered to explain this effect: (1) oil helps leaders to buy off democratic demands via generous distribution, (2) oil leads to the expansion of a security apparatus that facilitates repression of democratic movements, and (3) oil leads to higher incomes but not necessarily promotes social capital. Yet, entirely missing from this literature is an understanding about how oil affects citizen's attitudes about democracy. In this paper, I argue that citizens in oil-rich countries should hold more negative attitudes about democracy compared to citizens in countries without oil. This is the result of two causal factors. First, I argue that citizens in oil-rich countries are more likely to perceive their government as an effective and generous distributor, which dampens their criticism of the government as a whole. Second, given the volatility associated with oil dependence, citizens in oil-rich countries should value economic security and remain skeptical about turning over a stable authoritarian bargain in favor of an uncertain but liberalized political future. I test my argument using survey data from the Arab Barometer, which comprises 14 countries in the region over the period 2006 to 2019. I demonstrate that people in the Middle East's oil-rich countries tend to hold more negative attitudes about democracy compared to people in the oil-poor countries. People in the Middle East's oil-rich states are more likely to believe the following: (1) economic performance is weak in a democratic system, (2) democratic systems are indecisive and full of problems, (3) democratic systems are not effective at maintaining order and stability, (4) a democratic system is not better than other political systems, (5) the citizens of their country are not prepared for democracy, and (6) democracy is inappropriate for their country. These attitudes hold irrespective of how rich or poor their country is, how democratic or autocratic it currently is, how stable or unstable it was during the Arab Spring, or the extent to which a person believes their government is actually democratic. In order to shed light on the effects of the Arab Spring, I compare democratic attitudes in two countries that saw governmental crises: Algeria and Jordan. Public attitudes about democracy have remained more negative in oil-rich Algeria than in oil-poor Jordan.
The IMF’s history with most countries in the MENA region is well established and much studied, as the IMF has been instrumental in sponsoring structural adjustment programs in Egypt, Morocco and Tunisia since the 1980s. Its interaction with Iraq is more recent and less well studied. With Iraq at war or sanctioned, the IMF had no contact with the country from 1983 to 2003. The IMF’s re-engagement with Iraq takes place in the context of US occupation in 2003 and as the Iraqi economy is recovering from decades of war and sanctions. What is more, unlike its prior encounters with MENA countries, the IMF’s re-engagement with Iraq in 2003 occurs in a period when the IMF is reassessing its own doctrine and methods, placing more emphasis on the provision of social welfare and even raising concerns about rising inequality.
In an effort to enlarge our understanding of the IMF’s involvement with MENA countries, this paper will examine Iraq’s relationship with the IMF since 2003, using IMF article IV consultations with Iraq, IMF country reports, as well as secondary sources. I will show, first, that the IMF’s influence over public policy in Iraq has been modest and declining over time. Because of Iraq’s vast oil wealth, the IMF has been unable to dictate terms as elsewhere; its influence declines with the completion of Iraq’s (IMF managed) debt write-off and follows rising oil revenues. From failure to heed IMF advice to reform Iraq’s public distribution (rations) system and hydrocarbon law, to unwillingness to abide by IMF dictates on budget apportionments for the Kurdistan Regional Government, strategic interests and popular agitation have typically stymied IMF influence. Second, I argue that the evidence suggests that the IMF, in general, has shown some realism and understanding of Iraq’s economic conditions, arguing for the protection of social spending and for the protection of the poor, which stands in sharp contrast to the market fundamentalism of the occupying US administration. Finally, I argue that despite the IMF’s changing doctrine, its tools remain rooted in the past, pointing to clear inconsistencies in IMF policy and practice. This research fills a gap in our understanding of IMF policies in MENA. It equally contributes to ongoing discussions and policy work concerning recovery and rebuilding in post-conflict countries (in MENA and elsewhere).
Abstract
Proposal for ‘Individual paper.’ The paper would ideally fit into a panel related to development/change in the Arab Gulf countries og in MENA in general.
Title of paper:
The transformation from Rentier states to Knowledge based Economies: The case of the Arab Gulf countries.
Abstract
It is a difficult task for any country to transform into a knowledge economy, due to the fact that a successful knowledge economy rests on an intricate relationship between, entrepreneurship, motivation, and enabling economic and institutional regimes.
A successful knowledge economy thus entails more than just having a well-educated population. As Nobel laureate Joseph Stiglitz articulates, successfully establishing a knowledge economy requires a broader change in culture which focuses on citizens’ participation (in economic activities), ownership of processes and active learning so that motivation, aspirations and entrepreneurship will become an intrinsic ethos of the individual.
This paper takes its theoretical point of departure in Rentier State Theory (RST) to contextualize the dynamics within the Gulf Economies. It aims to analyzes the challenges and opportunities facing the planned transition from rentier economies to knowledge economies in the GCC countries.
The analyzes carried out in the paper include the following: First, the concept of a knowledge economy will be defined and discussed as it relates to the Gulf context. Second, the current status of the GCC countries in regard of a knowledge economy will be analyzed, using data from the World Bank Knowledge Economy Index and the Global Competitiveness index. These data highlights that in an international comparison the GCC states perform well in regard to their enabling environment and quality of ITC infrastructure, but performs poorly on the two pillars of education and innovation.
The paper proceeds to analyze and discuss reasons for the meager performance on these two pillars. Using data from extensive field work (especially in UAE) and key documents the quality and performance of the educational system at primary, secondary and tertiary level is analyzed. In recognizing that human resources are closely tied to the individual person, Beblawi’s concept of ‘rentier mentality’ is applied to facilitate a discussion of incentives. One key finding is that the Gulf Arab youth lack broader societal incentives to pursue both learning and innovation. Finally, the paper advocates that both job content (aiming for high job content) and especially increases in job productivity are important drivers for facilitating the transformation to knowledge economies.
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