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Oil and dynastic rule have led to an idiosyncratic pattern of state formation in the Gulf, and in few parts of the state are the idiosyncrasies more pronounced than in the security sector. Oil income has allowed the ruling families of the Gulf Cooperation Council (GCC) to engineer a relatively soft, rent- and patronage-based authoritarianism characterized by multiple centers of power and huge institutional redundancies. Having constructed their police and military forces along these lines, their monarchical rule has become more resilient, but their armed forces also more hapless.

Theories about the politics and economics of resource-rich or "rentier" states have been around for almost four decades now (Mahdavy 1970; Beblawi 1987; Chaudhry 1997; Humphreys et al. 2007). Political scientists and economists have argued that rents have a negative impact on levels of democracy (Luciani 1987; Ross 2001), on the quality of institutions (Chaudhry 1997; Isham et al. 2005), and on economic growth (Sachs and Warner 2001). Although much debate has been conducted over these macro-correlations, far less attention has been devoted to the causal mechanisms behind them. There is still no unified theory of rentier states, and the micro-foundations of rentier systems in particular have gone largely unexplored.

The article explains how several Gulf rentier monarchies have managed to create highly profitable and well-managed state-owned enterprises (SOEs), confounding expectations of both general SOE inefficiency and the particularly poor quality of rentier public sectors. It argues that a combination of two factors explains the outcome: the absence of a populist-mobilizational history and substantive regime autonomy in economic policy-making. The author concludes that it is necessary to rethink the commonly accepted generalizations both about rentier states and, arguably, about public sectors in the developing world.

The article explains how several Gulf rentier monarchies have managed to create highly profitable and well-managed state-owned enterprises (soes), confounding expectations of both general soe inefficiency and the particularly poor quality of rentier public sectors. It argues that a combination of two factors explains the outcome: the absence of a populist-mobilizational history and substantive regime autonomy in economic policy-making. The author concludes that it is necessary to rethink the commonly accepted generalizations both about rentier states and, arguably, about public sectors in the developing world. (World Politics / SWP)