Due to Russia’s geographic scale and military might, it amplifies typical problems of many petrostates from Venezuela to Nigeria to Iran. In an attempt to theorise these multiple problems Alexander Etkind introduces the concept of a hyper-extractive state, whose elite gets their wealth directly from natural resources with miniscule participation from the people. Is demise inevitable for these hyper-extractive states?
In modern Russia, one percent of the population participates in the extraction, transportation, and trade of oil and gas. These chosen people provide about half of the state revenue and two thirds of national export. Boom and bust in this country have both been conditioned by the in-and-outflows of petrodollars and gaso-euros. In all this Russia is not unique; it is rather exemplary. Due to its geographic scale and military might, it amplifies the typical problems of many petrostates from Venezuela to Nigeria to Iran.
Political scientists have written about the “oil curse” – the non-democratic governance, administrative corruption, and social inequality that are typical for petrostates. Economists have written about inclusive and extractive states: while inclusive meritocracies build productive institutions, exclusive states suppress such institutions because they undermine profits and privileges of predatory elites.1 Combining both traditions, I introduce the concept of a hyper-extractive state, whose elite gets their wealth directly from nature with miniscule participation from the people and institutions of the state.