Toward a Political Economy of the Arab Uprisings

Toward a Political Economy of the Arab Uprisings

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A framework to explain the Arab uprisings should provide an account of the socioeconomic and political evolution of the Arab republics that would explain both the persistence of autocracy until 2011 and its eventual collapse and should do so in a way that is empirically verifiable. Different analysts would approach such an ambitious question in distinct ways. Some would stress contingency and agency, and undeniably, there were such elements in the particular timing of the uprisings in Tunisia and Egypt. But we contend here that there must also have been structural factors that opened up a window of opportunity from which the main protagonists in the uprisings profited.

The framework that we propose connects patterns of economic development (especially a shift toward a more market-based system, the decline of public welfare functions, and the rise of crony capitalism), social change (the rise in popular aspirations and grievances), and political change (the defection of the middle classes from the authoritarian coalition). This combination of changing economic circumstances and the attendant increase in inequality of opportunities finally unraveled the implicit bargain between authoritarian rulers and key constituents.

We develop below each of the pieces of this story in more detail, including the rollback of the state, the shifting composition of the authoritarian coalition and the rise of crony capitalism, the rising but frustrated aspirations of the middle classes, and rising inequality. We then address the role of political Islam before and during the revolts.

Prolonged Discontent: The Socioeconomic Foundations of the Arab Uprisings

Many of the characteristics of the recent Arab uprisings are puzzling and do not fit easily within popular intellectual frames. Why did they occur at the end of 2010, when there were no apparent direct triggers such as declines in subsidies or shifts in foreign alliances, rather than in the 1990s, when the welfare state began to be rolled back? Why did the revolutions start in Tunisia and Egypt, the countries with some of the highest economic growth in the region in the preceding few years, rather than in countries such as Syria or Yemen, where economic conditions were more dire and political repression more severe? Why were they initiated by secularist middle-class youth, the supposed beneficiaries of the modernizing republics, rather than by the long-standing Islamist opposition?

In the early days of the Arab Spring, debates about the relative importance of economic versus political factors permeated journalistic and scholarly discussions about the motivations for the mass protests across the region. On the face of it, economic factors hold little explanatory value. In the preceding decade, economic growth was not low in the “revolution” countries, at about four to five percent of GDP per year—although these did not reach Asian double-digit levels, which would have been needed to absorb the youth bulge in the labor market. In cross-regional comparative perspective, youth unemployment was high in the Arab world, at around twenty-five percent, but this was not a new development and therefore cannot explain the timing of the protests. The macroeconomic situation was also relatively stable after the imbalances of the early 2000s were absorbed, with shrinking budget and current account deficits and reasonable debt levels. On the eve of the uprisings, international reserves were at comfortable levels. Inequality was lower than in other region (Belhaj and Wissa 2011).

To be sure, the 2008 global recession, coupled with the oil and food crises, did affect the region. Growth slowed down after 2008, and while it had recovered somewhat by 2010, it remained below the levels reached in 2006 to 2008. Energy subsidies increased with international prices, further eroding the ability of the state to spend on public investment and wages, while inflation rose and real wages fell. But by 2011, on the eve of the revolts, there was no singular economic shock to point to as a candidate for igniting the uprisings.

The Rollback of the State and Deteriorating Economic Security

In the postcolonial period, the state played an unusually important role in economies across the Arab world. A leading family of structural narratives on the Arab uprisings focuses on a slow transition from quasi-socialism in which the rollback of the state, which began in the mid-1980s, ultimately led to the breakdown of the social contract underlying the autocratic bargain. Such accounts cannot claim that state rollback is the proximate cause of the revolts, given the long time lag. Nonetheless, to analyze the ultimate collapse of the system we need an understanding of the mechanisms were used by autocrats to remain in power, even as market forces chipped away at their authority, and which contradictions emerged in this late autocratic period characterized by selective repression, co-optation, and cronyism.

A look at key economic performance indicators for the Arab developing countries as a group, from 1980 to 2008 shows clearly that the rollback of the state began twenty-five years ago. Government expenditure shot up in the 1970s on the back of rising oil wealth in the region, reaching more than fifty percent of GDP, but fell precipitously in the 1980s, reaching twenty-two percent of GDP in the early 1990s, a low figure by international standards. At the same time, private investment did not rise significantly to make up for the shortfall. Subsidies to agriculture were cut deeply, which was particularly damaging to the rural poor, while lower public-sector wages and hiring freezes hurt civil servants and formal-sector workers. In countries across the region, including Egypt, Jordan, Morocco, and Tunisia, protests erupted. In particular, attempts to cut subsidies on basic food items sparked “bread riots,” which often compelled rulers to retract agreements with international financial institutions to reduce these expenditures.

In the post-independence period, rulers across the region, in both the “populist” republics and the “conservative” monarchies, had expanded the public welfare infrastructure as part of state- and nation-building processes. The first few decades after independence witnessed major gains in quality-of-life indicators. In addition, poverty rates are significantly lower in the Middle East than in other regions of the Global South. In 2005, the percentage of the population living on two US dollars per day was about seventeen percent in the Middle East and Latin America, thirty-nine percent in East Asia, seventy-three percent in sub-Saharan Africa, and seventy-four percent in South Asia (World Bank, World Development Indicators, 2005). Thus, in the decades after independence, Arab citizens experienced important and tangible socioeconomic gains that arguably raised their aspirations.

Access to basic services and stable employment provided a sense of economic security, while human development gains enabled earlier generations in post-independence Arab countries to enjoy some social mobility. Formal-sector workers and especially civil servants became the main beneficiaries of the new deal and were important foundations of authoritarian bargains across the region.

The steady decline in public welfare institutions since the 1980s has affected all segments of the population beyond the wealthy elite, but it has been particularly damaging for the poor and the lower middle classes, who rely on government services. In the 1980s and 1990s, economic crises in other regions, such as Latin America and sub-Saharan Africa, had helped to provoke regime change during the near-synchronous “third wave” of democratization (Huntington 1991). In the Middle East, however, autocratic rulers did not open up the political space in order to reduce social pressures stemming from the decline in economic resources. To the contrary, the opposite may have happened. In 2010, the region was politically less open than in the mid-1980s, with the average score of citizen empowerment for the region falling from about six in 1980 to 1.2 in 2010 on a scale from zero to fourteen, with zero depicting complete dictatorship (Cingranelli-Richards Human Rights Dataset, various years).

External support for authoritarian rule is a distinctive feature of the region and therefore a key component of any explanation for the persistence of authoritarianism in the Middle East in comparison with other regions (El Badawi and Makdisi 2007; Bellin 2004; Levitsky and Way 2010). External support provided rents in the form of aid and military support but helped to fuel the militarization of the region, which in turn facilitated state repression of opposition groups.

Repression, Co-optation, and the Authoritarian Bargain

Repression is certainly a core component of any account of authoritarian persistence. The threat of harassment, persecution, imprisonment, torture, and death is a powerful disincentive for anti-regime activism. The level of spending on security matters attests that repression had become an essential tool in the preservation of autocratic regimes in the late 1990s. Average levels of repression in the region are measured by the Index of Physical Integrity on a scale from zero to eight where zero is maximum repression: between 1980 and 2010, the average value of the index for the Arab countries fell from 4.5 to 2.9 (Cingranelli-Richards Human Rights Dataset, various years).

Repression is never a sufficient tool of political control. The literature on persistent authoritarianism in the Middle East has described in detail how different regimes chose to respond with distinctive mixes of co-optation and repression to maintain their control. Autocrats aimed to maximize their dwindling assets by dividing citizens into groups that benefited from cooperation while others were subject to repression and neglect. One important strategy was to strengthen governing coalitions by co-opting the middle classes. Mass co-optation was achieved in large part through direct economic benefits in the form of subsidies for goods that were consumed relatively less by the poor, and especially for petroleum and energy. Earlier subsidies for small-scale agriculture and for basic food items that benefited the poor had been reduced.

Energy subsidies grew over time, and by 2011 they were much higher in the Arab region than in any other region of the world, representing about 8.5 percent of regional GDP and twenty-two percent of total government revenues. Within the region, levels of subsidies vary, but twelve of the twenty countries in the region have subsidies above five percent of GDP. In many countries, they now represent an expense several times higher than total spending on health or on education. This phenomenon is not restricted to oil exporters. For example, in 2011, energy subsidies represented forty-one percent of government revenues in Egypt. It is well known that such subsidies are very regressive, as oil products tend to be consumed in much larger quantities by richer people. In Egypt for example, forty-six percent of the benefits of petroleum subsidies accrued to the top twenty percent richest in 2008 (Abouleinem, Al-Tathy, and Kheir-el-Din 2009). The large cost of subsidies exacerbated economic crises and furthered the decline of public services, consuming ever-larger portions of government budgets, and limiting public investment, especially in rural and disadvantaged areas.

At the same time, fiscal regimes have become more pro-rich over time. Tax rates have been relatively low, particularly in the countries with large hydrocarbon reserves. Even in the countries with low per capita natural resources, direct taxes now constitute a relatively small share of fiscal receipts. Indirect taxes, which are inherently regressive because they are applied to consumers across the board, regardless of income level (Imam and Jacobs 2007), became a more important component of tax revenue in these countries after the reforms of the 1990s.

In the mix of co-optation and repression—or carrots and sticks—changes in the former mattered more in explaining authoritarian breakdown than the latter. If repression helped authoritarian regimes to endure, it cannot explain why dictatorships collapsed across the region: repression was constant, and had even been increasing since the 1990s. Thus, any explanation for authoritarian breakdown must probe the evolution of co-optation. In the next section, we trace the narrowing of authoritarian social coalitions—that is, the groups that were favored in domestic political economies—and describe how this factor contributed to authoritarian breakdown.

Crony Capitalism

By the mid-1990s, the old social contract in post-independence Arab countries was already dead but had not been replaced by a new successful model. The popular discontent that led to the uprisings can be traced to two main elements of economic policy: the rollback of the state and the consolidation of close relations between the state and particular elements of the business elite under economic liberalism. The central question of why the Arab region underperformed in terms of job creation, given what looked on paper to be impeccable market reforms, has been debated for years. Some have argued that the market reforms did not go far enough (World Bank 2009), while others hold that economics became dominated by networks of privilege (Heydemann 2004) that reduced competition and innovation, and thus job creation.

Conceptually, there is nothing intrinsically bad about close state-business relations. The case of South Korean chaebols illustrates how industrial policy can foster accumulation and the development of new sectors, even when state-business relations are characterized by cronyism (Khan 2010). To the extent that they provide the right incentives to perform, close state-business relations can form the basis for dynamic capitalism. In the Arab world however, tight state-business relations seems to have become a source of undue influence and corruption that have distorted economic and political incentives.

Popular perceptions of business elites have become quite negative in the region. Cronyism is now seen as both the key characteristic of the economic opening that started in the 1990s and accelerated in the 2000s and the source of many ills, including the job deficit, the rise in inequalities, and the perpetuation of authoritarian rule. The perceived “corruption” of the political and business elites was a key driving force of popular discontent. For example, a Pew survey reveals that in 2010 corruption was the top concern of Egyptians, with forty-six percent listing it as their main concern even ahead of lack of democracy and poor economic conditions (Pew 2011). Changes in the corruption ratings of Arab countries in the Transparency International Index confirm popular perception: for example, in 2005, Egypt ranked seventieth and Tunisia ranked forty-third out of 158 rankings on the Corruption Perceptions Index (CPI). Perceived corruption increased markedly in the following three years. In 2008, Egypt dropped to one hundred and fifteenth and Tunisia to sixty-second out of 180 rankings on the CPI.

We now know that this was not just about perceptions. In both Tunisia and Egypt, the ongoing trials of leading businessmen are starting to shed light on the ways in which influence was yielded for private gain. Cronyism entailed practices such as the granting of monopoly rights to close associates of the rulers, the selling of public firms and land at reduced prices, and the manipulation of the financial markets for the benefits of a few insiders. In Tunisia, the Ben ‘Ali and Trabelsi families monopolized business opportunities and even expropriated the real estate and business holdings of wealthy elites. Similar stories about favoritism and insiders abound in Syria, Libya, Yemen, and Algeria, where political cronies seem to control large chunks of the private sector.

The precise nature of state-business relations varied from country to country, with important ramifications for the dynamics of authoritarian stability and breakdown. In Egypt, Gamal Mubarak and his allies had gained important footholds in the Egyptian economy and profited from lucrative international deals, but this faction of the regime was counterbalanced by a strong and historically powerful protectionist bourgeoisie, which included but was not limited to the military. In the aftermath of the uprising, the importance of the military in the Egyptian domestic economy became well known, albeit in imprecise terms. The important stakes of military institutions in protected industries help to explain why the army allowed Mubarak to fall but stymied substantive democratization afterwards. In Tunisia, the elite coalition in Ben Ali’s regime appeared to have narrowed much more than in Egypt. As a result, by the time mass protests erupted against the Ben ‘Ali regime, many Tunisian capitalists who were not integrated into his networks of privilege supported his downfall.

The literature on contemporary Arab capitalism is still in its infancy. With few direct measurements of the extent of favoritism, however, there have been no serious attempts to statistically evaluate the socioeconomic impact of cronyism. A recent study of the Egyptian stock market around the momentous events of 2010 sheds some light on these issues. In evaluating the value of firms’ political connections through an event study of stock market reaction to the revolution, Chekir and Diwan (2012) estimate these to be about thirty percent of the firms’ value. They also compare the past corporate performance of connected and unconnected firms. In 2002, connected firms were about the same size as the other firms on the exchange, but by 2010 their median size had increased to seven times the median of non-connected firms, which had barely grown. Their analyses indicate that connected firms had a larger market share than their non- connected competitors and borrowed much more than their competitors—by 2010, the top twenty-two connected firms received eighty percent of the credit going to the largest one hundred Egyptian firms. Importantly, they also found that the connected firms were less profitable than the non-connected firms. So if favors were intended as industrial policy measures, they were not particularly successful. More likely, they were run inefficiently by regime cronies who had been appointed because they were trusted rather than skilled. Their goals were to deny the heights of the economy to potential regime opponents, bankroll the ruling party, and enrich themselves. Indeed, well-connected businessmen became very rich and are central to the perception of a large rise in the one percent in Egypt in recent years.

Thus, this system channeled capital flows to relatively inefficient sectors, reducing economic growth directly, while starving small and medium-size enterprises for credit, despite the fact that they provided a disproportionate share of new jobs. Instead of a dynamic form of capitalism, what emerged from the neo-liberal reforms was a low performance economy, with private investment in Egypt never going beyond fifteen percent of GDP, large capital flight (Kar and Curcio 2011), and stagnating job creation. So besides being an important factor behind economic underperformance in the region, cronyism signaled the narrowing of authoritarian coalitions, squeezed out the middle classes, and fueled perceptions of rising inequality.

The Evolution of the Authoritarian Coalition and the Role of the Middle Classes

In the initial decades after independence, Arab governments—and especially the republics—introduced policies that led to significant social change. In particular, statist economic policies coupled with welfare programs and subsidies on basic food items and fuel facilitated the rise of proto-middle classes. Public-sector workers, benefiting from job security and social benefits, were the most important component of the new middle classes. Also emerging was a professional class composed of doctors, lawyers, engineers, bankers, and others who enjoyed enhanced social status and a good standard of living. For decades, Arab autocrats had placed a premium on retaining the mainly secular middle-class either within the authoritarian coalition or as part of the legal opposition. For the republics in particular, social progress was at the center of their Arab nationalist credo—leaders such as Bourguiba and Nasser adopted an Atatürkian model of modernization in which the middle classes played a legitimizing role. Thus, for Arab autocrats, losing their middle-class anchors was tantamount to becoming naked dictatorships with no operational narrative.

Some members of the middle classes have been hurt by the economic liberalization of the 1990s, but others have benefitted. Low public-sector wages fueled petty corruption in areas such as health and education, generating an important source of discontent. To be sure, governments retained important policies aiding the middle classes, such as subsidies. As a result, the authoritarian bargain of the past decade evolved into an alliance between elite capital and elements of the middle classes that delivered economic benefits to coalition members but that repressed the poor. Moreover, low economic growth frustrated the educated youth aspiring to middle class status.

More than its size, it is the nature of the middle classes that changed over time. Until recently, specialists did not seem to believe that the middle classes could play an active role in leading political change. With the middle classes incorporated into the system as civil servants and employees of state-owned enterprises, their influence on policy formulation and their ability to play the role of an “autonomous actor” were effectively undercut. A new, market-oriented middle class rose in the late 1990s in response to economic liberalization. The newcomers tended to be small merchants and industrialists, often in the informal sector, who benefited from the pro-market reforms, as well as the small but expanding skilled component of the formal private- sector labor market. This group has been more politically active than older elements of the private sector. For example, the new, pro-market middle class played an important role in securing the success of the Iranian revolution in 1979 and the rise of the Justice and Development party in Turkey, and it has become a more vocal and assertive element in the Moroccan business community.

It is possible to evaluate the perceived socioeconomic conditions of the middle classes by looking at opinion poll surveys. Data from the World Values Survey provide a preliminary indication of shifting self-perceptions of citizens in Egypt. The survey, which asks respondents to identify the class to which they belong, provides a broad, self-assessed measure of well-being that goes well beyond income in capturing lifelong income, grievances, and aspirations. The analysis of opinion by social class shows that both the poor and the middle class increased their support for democracy between 2000 and 2008, but for different reasons (Diwan 2013). Among the poor, support for democracy went hand in hand with a rise in perceptions of inequality. The middle class on the other hand were much more driven by a sense of frustrated aspirations. This suggests that it was the coincidence of rising inequality and low economic opportunity, together with higher levels of education among the middle class that produced a coalition of poor and middle class citizens calling for change. Indeed, the survey shows that average financial satisfaction of the poor has deteriorated between 2000 and 2008, while that of the middle classes remains stable, and that of the rich has risen, further bolstering a sense of rising inequality during the period. While the youth may have mobilized more than other age groups in protests across the Arab region, these surveys do not support the claim that there is a generational split in opinions on the desirability of democracy at the present juncture. Instead, it seems that the parents of Egyptian middle-class youth became as unhappy as their children about their lack of job opportunities.

Deteriorating socioeconomic conditions combined with high aspirations increased discontent among the middle classes. As a result, they gradually withdrew their support for authoritarian regimes and entered into an implicit coalition for change with the poorer segments of the population. Dissatisfaction with the status quo, however, cannot simply be inferred from real economic conditions. Perceived conditions are more important in translating grievances into action than objective economic indicators. To understand the unraveling of authoritarian coalitions, we must comprehend how the middle classes have developed a sense of frustrated aspirations—an issue we address in the next section.

Perceived Inequality

It is tempting to make inequality a core driver of an understanding of the Arab Spring in the context of the transition from state quasi-socialism and populism toward capitalism. This transition appears to have generated socially unacceptable inequalities, directly by supporting the growth of a class of the super-rich and indirectly by its inability to create sufficient good jobs for the newly educated middle classes. Yet no direct evidence suggests that inequality as measured by household consumption surveys has risen sharply in the recent past. Household surveys reveal that consumption inequality has risen moderately in Egypt and fell slightly in Tunisia, but there are also indications of a rise in the urban-rural divide.

There are two reasons to think that these statistics describe only a limited part of reality. First, household surveys are notorious for undercounting the rich. There are many indications of a rise in the income share of the ten percent richest in society, who are perceived to have benefited most from a more market-oriented economy, and of the top one percent, who have benefited most from the rampant crony capitalism of the last decade. By some estimates, the top ten percent in Egypt, Morocco, Jordan, and Syria may have commanded thirty to forty percent of GDP by 2010.

Second, grievances seem connected to changes in the inequality of opportunities rather than to the inequality of incomes per se. Over time the rollback of the state had reduced the role of the state as an employer. In Egypt, for example, only twenty-five percent of the labor force worked for the state by 2009, declining from a height of forty percent of the workers. Furthermore, the bifurcation between the formal and informal private sectors has sharpened. Informal-sector workers tend not to transition into formal-sector jobs, and although public-sector employment has increased in recent years, workers who previously held positions in the formal private sector are far more likely than informal-sector workers to move into government jobs (Assaad 2011). Recent studies show clearly that the large waves of more educated workers entering the labor market were faced with an increasingly unfair situation whereby personal connections (wasta) and status were more important than diplomas in getting good jobs. With shrinking government employment, these new entrants had to divide themselves between the formal private sector, which did not grow in proportional terms and where wages were higher than in the public sector, and a large and growing informal sector, where wages were lower than in the public sector (Assaad 2009). Furthermore, the decline of health and education systems, key drivers of social mobility, had limited the ability of non-elites to advance (Salehi-Isfahani, Belhaj, and Assaad 2011). Empirical research has only recently started to focus on this type of inequality, but recent work is starting to show that measures of inequality of opportunity show a dramatic increase in recent years. In the context of post-independence social bargains, in which citizens experienced and came to expect real social mobility as a result of state economic and welfare policies, the inability to advance socioeconomically must have been especially frustrating.

The Role of Political Islam in the Arab Uprisings

Before concluding, it is essential to address one additional factor—the role of political Islam—in the evolution of politics across the region both prior to and during the uprisings. In the aftermath of the Arab uprisings, Islamists have become increasingly important if not dominant actors in Tunisia and Egypt and, to a lesser degree, in Libya and Yemen. It is widely accepted that the uprisings were not driven by Islamists, or even by increased popular support for Islamists, who were the most vocal opponents of authoritarian rulers. Rather, Islamists were the main beneficiaries of the transitional political systems that emerged after dictators were ousted. Although Islamists did not initiate or lead the revolts, they have played an indirect role in driving the Arab uprisings.

In particular, two mechanisms seem to have contributed to the defection of the middle classes from authoritarian bargains. First, since the 1990s, Islamists across the region have become less threatening because they have increasingly moderated their ideology and tactics. For example, in 2004 the Muslim Brotherhood in Egypt made a public commitment to abide by a constitutional and democratic system that called for the recognition of “the people as the source of all authority,” and it endorsed the principles of the transfer of power through free elections, the freedom of belief and expression, the freedom to form political parties, and the independence of the judiciary (Shahin 2005).

Similar processes of moderation took place in Turkey and Tunisia. In Turkey, a combination of the lessons from repression, opportunism, and the growth of a friendly middle class compelled the AKP to moderate (Demiralp 2009; Mecham 2004). In Tunisia, the Al-Nahda leadership claimed in 1981, “We have no right to interpose between the people and those whom the people choose and elect” (Tamimi 2001). The moderation of Islamists may have altered the calculations of socially liberal groups that had feared a takeover by Islamic parties because of their divergent views on issues such as civil rights, the separation of mosque and state, the role of women in society, and foreign policy. Even in the context of declining economic benefits, middle-class elements may have opted to support autocrats as long as Islamists championed a very different picture of civic and political life. As more moderate Islamic parties emerged, they may have garnered more support or at least tolerance among the middle classes. At the same time, insurgent groups using violent tactics declined. If fear of Political Islam had perpetuated authoritarian rule, the subsequent decline in that fear undercut support for dictators.

Second, some of the messages of Islamist parties, which emphasized corruption and the lack of social justice under authoritarian rulers, reflected and may even have amplified growing discontent among the middle classes. Indeed, the leaders and cadres of mainstream Islamist groups, such as the Muslim Brotherhood in Egypt and its branches and analogous organizations in other Arab countries, were composed of middle-class professionals who were shut out of employment and other opportunities under crony capitalist systems.

Opinion polls in the Arab world undertaken by the Arab Barometer reveal that people favor more democracy and more Islamism at the same time. A more detailed analysis using data from the World Values Survey for Egypt shows that adherents of Political Islamism did not support democracy as much as secularists in 2000. By 2008, supporters of Islamism had become a force for democratization as much as secularists among the middle class (Diwan 2013). This finding suggests that Islamism acts as a conservative veil for the poor only, trumping their class interests. After 2008, however, this effect did not operate among the middle classes, either because they were better educated and/or because they were more likely to be influenced by more moderate parties within the Islamist umbrella.

Concluding Remarks

This framework we developed above includes the following key elements. First, in the mid-1980s, the rollback of the state began without a concomitant democratic opening. In this context, an elite, capitalistic class benefited from personal connections to acquire disproportionate access to lucrative opportunities. The elite allied with state security apparatuses, which enforced their dominance through repression (sticks) and economic co-optation (carrots) to maintain the support of the middle class. Tight state-business relations within a supposedly “liberal” economic environment and political repression did not translate into a successful industrial policy. Instead, a system of gift exchange between the state and key constituents developed; the moderate performance of this system inhibited growth and thus did not foster the creation of good jobs. Across the Arab world, countries that initially adopted distinct economic strategies and political regimes ended up with variants of the same crony capitalist systems. Divide-and-rule strategies, based on a combination of subsidies and repression as well as fear-mongering about political Islam, were the foundation of an increasingly fragile governing coalition.

Supported by the West, this autocratic, low equilibrium lasted for several decades. For a time, with the co-optation of the middle classes through subsidies and fear of a takeover by Islamists, and with the poor repressed and struggling to make ends meet, authoritarianism could endure. Mounting fiscal pressures, driven in large part by rising subsidies and lower tax revenues, led to deteriorating social services and lower public investment, further hurting the poor and marginalized regions and leading populations to identify increasingly with the poor rather than the middle classes. In this context, middle-class elements defected from authoritarian coalitions and evolved into champions of change, driven by the lack of opportunities for socioeconomic advancement and anger about rising perceived inequalities. In particular, economic Discontent on the economic front interacted with a broader sociopolitical context to ignite the uprisings. Stagnation mixed with the perceived rise in inequalities and lack of “social justice,” a perception that had been mounting as a result of the rollback of the state and economic liberalization characterized by cronyism. As a result, access to economic opportunities was not meritocratic or governed by a level playing field, but rather was mediated by connections to political leaders and their narrowing circles of allies. In the context of redistributive commitments by rulers to populations, which increased citizen expectations of the state in both the “populist” republics and the more conservative monarchies, the inability of government to provide for citizens and a growing sense of economic insecurity were particularly egregious. This combination of factors created a dam of accumulated grievances and rising aspirations, ready to burst. The inter-linkages between economic and political grievances point to the value of a political economy perspective in understanding the Arab uprisings.


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[This article is adapted from the chapter “Conclusion: The Political Economy of the Arab Uprisings”in A Political Economy of the Middle East: Third Edition, ed. Alan Richard and John Waterbury (Boulder, CO: Westview Press, 2013). It was first published in Arabic in Kalamon, Fall 2013.]

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