Rentier state
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A rentier (prounounced rän'tyā) is an individual who depends on income derived from rents. A rentier state is a term in political science and international relations theory used to classify states who derive all or a substantial portion of their national revenues from the rent of indigenous resources to external clients. The term is most frequently applied to states rich in highly valued natural resources such as petroleum, however it could be applied to nations who trade on their strategic resources (such as permitting the development of an important military base in their territory) as well. Dependent as they are on this source of income, rentier states may externally generate rents by manipulating the global political and economic environment. Such manipulation may include monopolies, trading restrictions, and the solicitation of subsidies or aid in exchange for political influence.
While many states export resources or license their development by foreign parties, rentier states are characterized by the relative absence of revenue from domestic taxation, as their naturally-occurring wealth precludes the need to extract income from their citizenry. According to Douglas Yates (cited here), the economic behavior of a rentier state
embodies a break in the work-reward causation ... [r]ewards of income and wealth for the rentier do not come as the result of work but rather are the result of chance or situation.
Reflecting this, political scientist Fareed Zakaria has posited that such states fail to develop politically because, in the absence of taxes, citizens have less incentive to place pressure on the government to become responsive to their needs. Instead, the government essentially 'bribes' the citizenry with extensive social welfare programs, becoming an allocation or distributive state. Control over the rent-producing resources is concentrated in the hands of the authorities, who may use it to alternately coerce or coopt their populace. There is, in the words of Noah Feldman in his book After Jihad,
no fiscal connection between the government and the people. The government has only to keep its people in line so that they do not overthrow it and start collecting the oil rents themselves. (Feldman 139)
In these resource-rich rentier states there is a challenge of developing civil society and democratization.
