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Destructive Competition: Factionalism and Rent-Seeking in Iran

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  • Bjorvatn, Kjetil
  • Selvik, Kjetil

Abstract

Summary The literature on the "resource curse" suggests that the quality of institutions determines a country's ability to transform resource wealth into economic development. This article explores the link between resource rents, institutions, and economic performance by focusing on the case of Iran. A key feature of Iran's institutional environment is its factionalized political system. We give an introduction to the main actors vying for control over the country's resources and analyze the effect of their destructive competition. Using a theoretical model, we study how oil revenues and the relative strength of interest groups affect private investment and economic efficiency.

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  • Bjorvatn, Kjetil & Selvik, Kjetil, 2008. "Destructive Competition: Factionalism and Rent-Seeking in Iran," World Development, Elsevier, vol. 36(11), pages 2314-2324, November.
    • Handle: RePEc:eee:wdevel:v:36:y:2008:i:11:p:2314-2324
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    References listed on IDEAS

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    Cited by:

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    2. Dong-Hyeon Kim & Shu-Chin Lin, 2017. "Natural Resources and Economic Development: New Panel Evidence," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(2), pages 363-391, February.
    3. Khezri, Mohsen & Heshmati, Almas & Ghazal, Reza & Khodaei, Mehdi, 2022. "Non-resource revenues and the resource curse in different institutional structures: The DIGNAR-MTFF model," Resources Policy, Elsevier, vol. 79(C).
    4. Christian Dreger & Teymur Rahmani, 2016. "The impact of oil revenues on the Iranian economy and the Gulf states," OPEC Energy Review, Organization of the Petroleum Exporting Countries, vol. 40(1), pages 36-49, March.
    5. Naghavi, Alireza & Pignataro, Giuseppe, 2015. "Theocracy and resilience against economic sanctions," Journal of Economic Behavior & Organization, Elsevier, vol. 111(C), pages 1-12.
    6. Parcero, Osiris J. & Papyrakis, Elissaios, 2016. "Income inequality and the oil resource curse," Resource and Energy Economics, Elsevier, vol. 45(C), pages 159-177.
    7. Mohammad Reza Farzanegan, 2012. "Resource Wealth and Entrepreneurship: A Blessing or a Curse?," MAGKS Papers on Economics 201224, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    8. Tohid Atashbar, 2013. "Iranian Disease: Why a Developing Country's Government Did Not Listen to Economists' Advices," American Journal of Economics and Sociology, Wiley Blackwell, vol. 72(3), pages 732-760, July.
    9. Vasilyeva, Olga & Libman, Alexander, 2020. "Varieties of authoritarianism matter: Elite fragmentation, natural resources and economic growth," European Journal of Political Economy, Elsevier, vol. 63(C).
    10. Kim, Dong-Hyeon & Wu, Yi-Chen & Lin, Shu-Chin, 2018. "Heterogeneity in the effects of government size and governance on economic growth," Economic Modelling, Elsevier, vol. 68(C), pages 205-216.
    11. Mohammad Reza Farzanegan & Mohammad Habibpour, 2014. "Direct Distribution of Rents and the Resource Curse in Iran: A Micro-econometric Analysis," CESifo Working Paper Series 4824, CESifo.
    12. Bjorvatn, Kjetil & Farzanegan, Mohammad Reza & Schneider, Friedrich, 2012. "Resource Curse and Power Balance: Evidence from Oil-Rich Countries," World Development, Elsevier, vol. 40(7), pages 1308-1316.
    13. Osiris Jorge Parcero & Elissaios Papyrakis, 2024. "Income inequality and the oil resource curse," Papers 2401.04046, arXiv.org.
    14. Pazouki, Azadeh & Zhu, Xiaoxian, 2022. "The dynamic impact among oil dependence volatility, the quality of political institutions, and government spending," Energy Economics, Elsevier, vol. 115(C).
    15. Mohammad Reza Farzanegan, 2014. "Can Oil-Rich Countries Encourage Entrepreneurship? ‘Yes’, ‘No’ but not ‘Perhaps’," MAGKS Papers on Economics 201406, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

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