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Economics

The Political Economy of Natural Resource Wealth and Regime Stability

Quick fact

In the 1980s, a collapse in oil prices forced the Soviet Union to cut subsidies to its allies and imports of consumer goods, fueling popular unrest that contributed to its breakup. This contrasts sharply with Saudi Arabia, which used its oil wealth to build a robust patronage system and quell internal dissent.

Why this is interesting

Oil wealth should make a regime unshakable—but sometimes it triggers its own collapse. Why does resource abundance bolster some dictators while destroying others?