Abstract

Empirical scholarship identifies social cleavages as a predictor of slower economic growth, greater civil conflict, and other socioeconomic ills. Meanwhile, accounts of divide-and-rule politics claim that predatory rulers may benefit politically from exploiting internal schisms. Altogether, then, does internal fractionalization work to the benefit or detriment of a rent-seeking ruler? To answer this question, I model the political economy of predatory governance in a fractionalized society. For rentier states, whose revenues derive from control over natural resources or a similar exogenous source, internal divisions work to the ruler's benefit by depressing collective resistance. The opposite is true for a state financed by endogenous labor output, as the negative effect of social fractionalization on economic production outweighs the decrease in collective action against predatory rule. The analysis thus highlights a new channel by which rentier states are distinctive: they are the sole beneficiaries of divide-and-rule politics.