When do oil dependent governments decide to spend oil rents in expanding their political machines through patronage, clientelism, and in enlarging their repressive apparatus (to become authoritarian) as some rentier theories claim, or in providing better public services to their citizens to expand the support base of their electorate? Contrary to the expectations of rentier theories, this work argues that infrastructure can rise and patronage decline during oil booms. When rents are high and the oil sector creates new jobs, incumbents tend to increase capital investment. They cannot compete with oil salaries and use infrastructure to cope with the sector’s pressures for basic services. When rents decline in contexts of job destruction in the oil sector, and the rest of the private sector cannot absorb the layoffs, incumbents tend to increase patronage to contain social turmoil and secure core voters. Using descriptive statistics, regression analysis for panel data for the 24 subnational units in Argentina (1983-2013), and two case studies, this work presents empirical findings to sustain the previous claim and discusses the theoretical implications for the comparative debate on the political and socioeconomic effects of oil rents.

Lucas Gonzalez holds a PhD in political science from the University of Notre Dame. His research interests are federalism, redistribution, and the political economy of redistributive transfers. He is a researcher at the National Council for Scientific and Technical Research (CONICET), professor at the Universidad Nacional de San Martín, and researcher at the Universidad Católica Argentina. He recently published a book with Routledge and has coauthored two others. He has also written articles for edited volumes and peer-reviewed journals, the last of which were published in The Journal of Politics, Latin American Research Review, Latin American Politics and Society, Publius: The Journal of Federalism, among others.