Petrostate Pathologies

Also doing vanity projectsdisplays of wealth to

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Unformatted text preview: h that no one purchases goods from inside the country that the manufacturing sector shrinks. ! have to find a way to employ people, since oil doesn’t employ that many people. Separate problem: government spending – any commitment that the government makes is going to be longer than the boom and bust cycle. Want to build roads when things are slow, not when everyone wants you to, which is politically difficult. Repression Effect You are going use some oil money to do displays of military and security might to impress neighbors and your own people because your throne is looking attractive. Also doing vanity projects/displays of wealth to dazzle Patronage Spending Effect Need to make ministers loyal Which leads to endemic corruption High levels of corruption are endemic Unlimited credit card effect E.g. Saudi Arabia getting into serious debt because they borrowed a...
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