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Timber Booms and Institutional Breakdown in Southeast Asia by Michael L. Ross

By Michael L. Ross

During this publication, Michael L. Ross explores the breakdown of the associations that govern average source exports in constructing states. utilizing case reports of bushes booms in Indonesia, Malaysia, and the Philippines, he indicates that those associations usually holiday down while states obtain confident alternate shocks--unanticipated windfalls. Drawing at the concept of rent-seeking, he means that those associations succumb to an issue he calls "rent-seizing"--the predatory habit of politicians who search to provide hire to others, and who purposefully dismantle associations that restrain them.

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To make their rights exclusive, politicians may need to change any institutions that give others the right to influence allocation decisions. Finally, politicians also can gain by making their allocation rights discretionary, to maximize their bargaining leverage with recipients. When officials have heightened discretionary powers, they can create new costs 11 By “patronage,” I mean a politician’s distribution of selective benefits to clients, in exchange for political support; by “corruption,” I mean a politician’s appropriation of state assets for personal or familial gain; and by “pork barrel projects,” I mean a politician’s distribution of collective benefits to constituent groups, in exchange for support.

Rent-seizing politicians may initially seek out preexisting state assets, like resource windfalls; but once they hold the ability to reshape resource institutions to their advantage, they may use the opportunity to create additional, allocable rents to meet their patronage and corruption needs. 15 Consider once more the example of a commodity sector. After gaining control of a state’s commodity institutions, politicians may create additional rents by speeding the pace of natural resource extraction and externalizing any environmental costs – fouling the air, soil, and waters.

Many of these factors are determined by a state’s regime type. All but the first change slowly over time. None seem likely to change quickly in response to a windfall. 34 Explaining Institutional Breakdown How Does Rent Seizing Effect Institutions? 11 Yet rent seeking produces the same result, making it difficult to distinguish between these two processes. When we look at state institutions, however, we find important differences. Rent seeking may produce no visible changes in state institutions, save for a higher incidence of corruption as politicians and bureaucrats succumb to bribes.

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