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  • Print publication year: 2020
  • Online publication date: March 2020

5 - NOCs, Oil Revenues, and Leadership Survival

Summary

This chapter presents a series of empirical analyses to test nationalization's primary effects on revenues and secondary effects on political survival. It begins by assessing the claim that nationalization will foster greater government take of resource revenues compared to maintaining operations by private firms. It then examines whether this corresponds to a higher probability of leadership survival: if nationalization increases state capture of resource revenues, then it should be the case that leaders use this wealth to consolidate power and prevent ouster. Beyond the survival of political leaders, it should also be true that political regimes in general will be stronger if resources are nationalized. These hypotheses are tested using the complete cross-national NOC dataset in conjunction with existing data on government revenues, the breakdown of regimes, and leadership survival. The empirics support the theory: nationalization increases state capture of resource revenues and increases the likelihood of survival of leaders and their political regimes. The results suggest that nationalizing operations explains why resource-rich leaders survive in some countries but not others.

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