Oil, Politics, and Economic Change in Indonesia and Nigeria
Publication Year: 2007
Published by: University of Michigan Press
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Chapter 1. Introduction
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What types of institutional arrangements are essential for economic growth in poor countries? What are the political conditions that foster the development of growth-inducing institutions? Although there is a good deal of consensus about the institutions generally needed for prosperity over the long term, we have much less certainty about the conditions for economic progress in poorly performing states, or in circumstances...
Chapter 2. The Political Economy of Development
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This study is concerned with the effects of institutional arrangements on economic growth and the political factors leading to institutional change. The central argument is that differences in long-term economic performance are determined by variations in the ability of states to make credible commitments to market participants. Such commitments include policy stability, secure property rights...
Chapter 3. Growing Apart Divergent Political Economies
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Indonesia and Nigeria offer natural comparisons as well as marked contrasts. With populations currently estimated at 242 million and 134 million, respectively, they are large countries with crucial positions in their subregions. Indonesia encompasses an archipelago of some 16,000 islands stretching over 3,000 miles from the Pacific to the Indian Oceans. The country accounts for about 40 percent of the total population among...
Chapter 4. Indonesia Crisis, Reform, and Growth
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Between 1966 and 1996 a widening gap appeared in the relative economic performance of Indonesia and Nigeria. Much of the variation can be explained by distinct economic policies that evolved in different political and institutional settings. This chapter and the next one summarize the critical periods of political and economic change for each state. After providing a brief historical prelude for each country...
Chapter 5. Nigeria Division, Distribution, and Decline
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Nigeria’s policy regime and the country’s evolution within the global economy differed substantially from those of Indonesia. Nigerian elites responded to different incentives, exacerbating the weaknesses of the rentier economy and avoiding needed adjustments in response to exogenous shocks. With the arrival of the initial petroleum windfall, Nigerian leaders pursued a set of policies that intensified the macroeconomic distortions...
Chapter 6. Comparing Economic Performance
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In the preceding analysis, I have drawn the linkages between institutional choice, policy selection, economic performance, and structural change, which affect the path of development over time. The empirical record of comparative economic performance in Indonesia and Nigeria helps to clarify and underscore these factors. In this chapter I assess relative performance in growth, income, the structure of the economy...
Chapter 7. After the Fall The Dynamics of Attempted Reform in Indonesia
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The diverging paths of Indonesia and Nigeria abruptly changed course on the eve of the millennium. In the throes of the Asian financial crisis, Soeharto’s regime collapsed in May 1998, and with it the growth coalition forged by the New Order over a period of decades. Political reforms led to a fledgling democratic regime the following year, against a backdrop of economic decline, social turmoil, and institutional disarray. Almost simultaneously, Nigeria experienced momentous political change...
Chapter 8. Predatory Rule, Transition, and Malaise in Nigeria
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Nigeria’s political and economic conditions in the late 1990s differed substantially from those of Indonesia. In marked contrast to Indonesia’s decades of growth and economic diversification, Nigeria developed an oil monoculture in which virtually all foreign exchange, and the preponderance of government revenues, were derived from crude oil exports.1 In consequence, the political economy was overwhelmingly concentrated on the distribution of rents...
Chapter 9. Conclusion Indonesia and Nigeria in Comparative Perspective
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This book offers a perspective on the political challenges of economic development. The problems of uneven development among regions and states have given rise to many questions about the conditions needed for sustained growth and competitiveness. Analyses of economic growth have increasingly centered on institutional factors, including the character of markets and the qualities of states in providing economic governance...
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Page Count: 360
Illustrations: 18 Tables & 8 Figures
Publication Year: 2007
Series Title: Interests, Identities, and Institutions