Written by the Fiveable Content Team • Last updated September 2025
Verified for the 2026 exam
Verified for the 2026 exam•Written by the Fiveable Content Team • Last updated September 2025
Definition
A rentier state is a country that relies heavily on income from external sources, such as natural resources or foreign aid, rather than its own productive activities.
The resource curse refers to the negative consequences that can arise in countries rich in natural resources, such as corruption, economic instability, and inequality.
Economic Diversification: Economic diversification is the process of expanding an economy by reducing its dependence on one industry or source of income and developing other sectors.
Foreign Aid: Foreign aid refers to financial assistance provided by one country to another for various purposes like development projects, humanitarian relief, or economic support.