BOOMS AND BUSTS: THEORIZING INSTITUTIONAL FORMATION AND CHANGE IN OIL STATES

A r=view essay on books by (1) Kiren Aziz Chaudhry, The Price of Wealth: Economies and Institutions in the Middle East (Ithaca, NY: Cornell U Press, 1997); (2) Terry Lynn Karl, The Paradox of Plenty: Oil Booms and Petro-States (Berkeley: U California Press, 1997); & (3) Dirk Vandewalle, Libya since Independence: Oil and State-Building (Ithaca, NY: Cornell U Press, 1998). Karl's analysis of the effects of oil revenues on policy making is praised for comparing institutions in several oil states (eg, Venezuela, Iran, & Algeria). Nevertheless, Karl's approach to analyzing oil states' institutions, which emphasizes differences between structuralists & individualists in explaining states' decision making during periods of economic boom & bust, is criticized. Chaudhry's critique of comparative political economic theories informed by New Institutional Economics is welcomed for offering a Marxist account of institutional change & the connection between nation building & international economics. However, Chaudhry's assertion that social ties & asset mobility are complementary elements in oil states' institutions is challenged. Although Vandewalle's study is congratulated for investigating how certain oil states establish certain institutions to reduce the authority of the state & social actors, his dichotomization of the bureaucratic characteristics in productive & distributive oil states is questioned. The implications of the reemergence of literature on oil states for future studies is also considered. J. W. Parker