Industrialization Waves and Geopolitical Positioning: The Non-Industrializers and Edge Cases
Filed under: history, economics, geopolitics
The industrialization-order framework the series has applied across the previous nine case articles carries considerable explanatory weight for the geopolitical positioning of the industrialized economies. The framework carries considerably less weight for a set of cases where supplementary explanations do more of the argumentative work. This article treats those cases at national and regional scope, identifies which supplementary mechanisms carry the load, and clarifies where the primary-structural framing established in the series opener reaches its explanatory limits. The clarification matters because the series has staked an explicitly primary-structural rather than sufficient claim, and honoring the limits of the account matters as much as honoring its reach.
The cases treated here fall into five clusters. The first cluster is the Middle Eastern oil-state economies where hydrocarbon resource rents dominate the positioning. The second is post-Soviet Russia where the resource-rent economy combines with Soviet institutional legacy and post-Cold-War security-legacy dynamics. The third is Sub-Saharan Africa where colonial-era border configuration and institutional legacies dominate over any industrialization-order effect. The fourth is Latin America outside the successful catch-up cases where the dependency-theory concerns and middle-income trap dominate. The fifth is several miscellaneous cases including Central Asia, Iran, North Korea, and Israel-Palestine that require case-specific supplementary explanation. The patterns each cluster exhibits are treated in turn.
Middle Eastern Oil States
The oil-producing states of the Persian Gulf and the wider Middle East occupy positions in the contemporary international system that industrialization-order alone does not adequately explain. Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Bahrain, Oman, Iraq, and Iran all exhibit significantly larger per-capita output than their preindustrial baselines would predict, substantially smaller manufacturing sectors than industrialization-follower cases at similar per-capita levels, and distinctive political-economic institutions organized around hydrocarbon-resource extraction and rent distribution.
Resource-rent dominance. The Gulf oil states derive significant fractions of their gross domestic product from hydrocarbon extraction and sale. Let $\rho$ denote the resource-rent share of gross domestic product. During peak oil-price windows the Gulf economies routinely exhibit
\[\rho \geq 0.30\]with the Saudi ratio reaching approximately fifty percent during the 1970s and 2000s oil booms, the Kuwaiti and Qatari ratios similar, and the Emirati ratio somewhat lower because of markedly diversified reexport, financial-services, and tourism sectors. The resource-rent share falls during oil-price troughs but the structural dependence on hydrocarbon extraction persists across the price cycle.
Rentier state dynamics. The Ross empirical analysis of whether oil hinders democracy documents the empirical pattern by which oil-dependent states exhibit systematically less democratic political institutions than resource-poor comparators at similar per-capita output levels. The mechanism combines the fiscal independence oil rents provide the state, the resulting absence of taxation-based political-representation demands, the Middle Eastern security-service state capacity oil rents fund, and the distinctive social-contract pattern in which the state provides substantial subsidies to citizens in exchange for restricted political participation. The rentier-state pattern applies across the Middle East and produces the distinctive Middle Eastern political configurations that industrialization order alone does not explain.
The Sachs-Warner resource-curse claim. The Sachs and Warner analysis of natural resource abundance and economic growth documents the empirical pattern by which resource-abundant economies systematically exhibit slower per-capita output growth than resource-poor comparators across the post-1960 window. Let $\Delta g_{\text{resource}}$ denote the per-capita growth-rate differential between resource-abundant and resource-poor economies at similar initial per-capita levels. The Sachs-Warner cross-country regressions estimate
\[\Delta g_{\text{resource}} \approx -1 \text{ to } -2\% \text{ per year}\]sustained across the post-1970 window, with the resource-curse mechanism operating through Dutch disease effects on manufacturing sectors, rent-seeking dynamics that distort political and economic institutions, and commodity-price volatility that disrupts sustained investment planning. The Middle Eastern oil states exhibit the resource-curse pattern in most measurable dimensions despite the marked per-capita income levels the oil rents produce.
Positioning outcomes. The Middle Eastern oil states occupy positions in the contemporary international system appreciably shaped by hydrocarbon dynamics rather than by industrialization order. The American and previously British strategic interest in Middle Eastern oil supply has produced sustained Western military presence, security guarantees for oil-producing states, and the 2020s dynamic in which oil-price stability remains a load-bearing American strategic interest despite the American shift toward domestic hydrocarbon production. The Saudi-Iranian rivalry, the Israeli-Arab security architecture, and the 2020s Abraham Accords realignment all operate greatly outside the industrialization-order framework.
Post-Soviet Russia
The Soviet forced-industrialization case treated in the sixth article of the series ended with the 1991 dissolution and the 1990s Russian transition to market economy. The subsequent post-Soviet Russian trajectory has produced a distinctive positioning that combines Soviet institutional legacy, post-1990s resource-rent economy, and the 2020s war-and-sanctions dynamic that requires supplementary explanation beyond the industrialization-order framework.
The 1990s transition catastrophe. Russian aggregate output contracted approximately forty percent between 1991 and 1998, a magnitude the sixth article of the series formalized as institutional-collapse ratio. The Yeltsin-era privatization produced extensive concentration of former state-owned enterprises in the hands of a small number of oligarchs through the 1995-1996 loans-for-shares scheme and other mechanisms. The 1998 ruble crisis and default produced additional economic disruption before the 1999-onwards recovery began.
The Putin-era resource-rent consolidation. The Vladimir Putin presidency from 1999 through the present has consolidated the Russian economy around hydrocarbon extraction, sustained state ownership of strategic sectors, and the Russian mixed model combining market elements with sizable state coordination. Russian per-capita output rose from approximately three thousand dollars in 1999 to approximately twelve thousand dollars by 2013, an appreciable recovery driven considerably by rising oil and gas prices during the same period. The Russian per-capita trajectory against the leading American level exhibits a distinctive collapse-recovery-decline pattern. Let $R_{\text{RU}}(t)$ denote the Russian per-capita ratio against the United States. The observed trajectory follows
\[R_{\text{RU}}(1991) \approx 0.20, \quad R_{\text{RU}}(1998) \approx 0.08, \quad R_{\text{RU}}(2013) \approx 0.18, \quad R_{\text{RU}}(2024) \approx 0.15\]which combines a post-1991 collapse of approximately sixty percent of the ratio, a 1999-2013 recovery of comparable magnitude driven significantly by hydrocarbon-price gains, and a post-2013 deceleration that combines sanctions, war-related economic disruption, and the Russian demographic and structural constraints. The pattern differs from every earlier convergence trajectory the series has formalized and reflects the Russian combination of institutional-transition legacy, resource-rent economy, and security-conflict dynamics that industrialization-order alone does not explain.
Contemporary sanctions and war. The 2014 Russian annexation of Crimea and the 2022 full-scale Russian invasion of Ukraine have produced considerable Western sanctions, sustained Russian military commitment, and the 2022-onwards Russian economic reorientation toward Chinese and other non-Western partners. The Russian contemporary positioning combines resource-rent economy, sustained military-industrial capacity inherited from the Soviet era, alignment with China against the American-led Western system, and distinctive strategic dynamics that industrialization-order analysis alone does not explain.
The Russian case demonstrates that industrialization-order effects can be substantially reversed or overwhelmed by supplementary factors including institutional collapse, resource-rent dependence, and security-conflict dynamics. The Russian trajectory across the 1991-2026 window is more legible in the institutional-and-resource-rent framework than in the pure industrialization-order framework the series has otherwise applied.
Sub-Saharan Africa
The Sub-Saharan African region occupies a position in the contemporary international system markedly shaped by colonial-era border configurations, colonial-era institutional legacies, and post-independence political and economic trajectories that industrialization order alone does not explain. The Acemoglu, Johnson, and Robinson colonial-origins analysis treated in the first article of the series applies at broader scope to the Sub-Saharan African case and identifies the load-bearing mechanisms.
Colonial borders and state configuration. The current borders of most Sub-Saharan African states were drawn at the 1884-1885 Berlin Conference by European powers negotiating spheres of colonial influence without reference to the political geography of the African polities that occupied the territories. The post-1960 independence-era states inherited these borders appreciably unchanged and have generally maintained them across the following six decades despite frequent internal-conflict pressures. The colonial-cartography origin of the current African state configuration is one of the load-bearing pieces of the Sub-Saharan African political-economic story that industrialization-order analysis does not capture.
Colonial extractive institutions. The Acemoglu, Johnson, and Robinson colonial-origins treatment documents that colonial powers established greatly different institutional patterns in colonies where European settlers could survive in significant numbers versus colonies where the European mortality environment was hostile to sustained settlement. The Sub-Saharan African tropical disease environment produced considerably extractive rather than settler-oriented colonial institutions, and the post-independence trajectories have significantly inherited the extractive-institutional patterns. The colonial-origins mechanism operates independently of and in parallel with any industrialization-order effect.
Slave-trade legacies. The Nunn empirical analysis of the long-term effects of Africa’s slave trades on subsequent African economic development establishes that the African regions most affected by the Atlantic and Indian Ocean slave trades exhibit measurable long-run economic underdevelopment relative to less-affected regions. The slave-trade mechanism operates on a multi-century timescale and constitutes an additional supplementary explanation beyond the industrialization-order framework.
Resource-curse patterns. Sub-Saharan African resource-abundant economies including Nigeria, Angola, Democratic Republic of the Congo, Zambia, and Botswana exhibit the Sachs-Warner resource-curse pattern with substantial variation. Botswana is the notable exception, having achieved sustained per-capita convergence through the distinctive combination of diamond-resource management, democratic political institutions, and substantially disciplined fiscal policy. The other resource-abundant Sub-Saharan African cases exhibit the standard resource-curse pattern combined with the African colonial-origins and slave-trade legacies.
Contemporary positioning. Contemporary Sub-Saharan African positioning combines marked Chinese engagement through Belt and Road Initiative infrastructure investment, sustained Western development-assistance relationships, post-2020s increasing Russian and Turkish diplomatic and military engagement in countries, and the distinctive African Union coordination framework. Aggregate Sub-Saharan African per-capita output growth across the 2000-2024 window has been extensive at approximately three to four percent per year, exceeding the pre-2000 trajectory but well below tiger or Chinese comparators.
Latin America Outside the Industrial Cluster
The Latin American region includes several partial-industrialization cases treated implicitly across the earlier articles, notably Brazil, Mexico, Argentina, and Chile, and a broader category of cases where the dependency-theory concerns and middle-income trap patterns the tenth article of the series formalized dominate. The Latin American twentieth-century experience with import-substitution industrialization, subsequent 1980s debt-crisis and liberalization, and twenty-first-century commodity-boom-and-bust cycles constitutes a distinctive comparative-development story.
The dependency-theory framing. Raúl Prebisch and Hans Singer’s specifically 1950s dependency-theory framework argued that Latin American economies exhibited structural disadvantages in international trade because of declining terms of trade for primary-commodity exports relative to manufactured imports. The dependency framing motivated the widespread Latin American adoption of import-substitution industrialization from the 1950s through the 1970s, and produced sizable industrialization in the larger Latin American economies before the 1980s debt crisis exposed the structural vulnerabilities of the model.
The 1980s debt crisis and Lost Decade. The 1982 Mexican debt default initiated the Latin American Lost Decade of the 1980s during which most regional economies experienced sustained negative per-capita output growth combined with hyperinflation and appreciable political instability. The Washington Consensus reforms during the 1990s produced considerable market opening across the region but did not restore the pre-1982 growth trajectory. Contemporary Latin American per-capita output remains markedly below the East Asian tiger and Chinese comparators despite the appreciably longer industrialization history.
The Chilean case. Chile is the most successful Latin American case with sustained per-capita convergence from the 1985-onwards reform period. Chilean per-capita output has grown from approximately two thousand dollars in 1985 to approximately eighteen thousand dollars by 2024, and the Chilean per-capita ratio against the leading American level has risen from approximately ten percent to approximately twenty-two percent across the equivalent period. The Chilean case exhibits the export-oriented resource-based development pattern with significant macroeconomic stability, and provides a Latin American demonstration that the middle-income trap is not deterministic.
The dependency vs institutional debate. The Latin American development experience motivated substantial economic-literature debate over whether dependency-theory concerns or institutional-quality factors better explain the Latin American middle-income trajectory. The Sokoloff and Engerman analysis of institutions, factor endowments, and paths of development in the New World argues that the Latin American colonial endowment-factor patterns produced institutional configurations less conducive to broadly shared development than the North American patterns, and that the Latin American path dependence traces to the colonial-era institutional design rather than to twentieth-century policy choices alone.
Central Asia and Other Special Cases
Several cases require case-specific supplementary explanation beyond the frameworks the series has applied.
Central Asia. The five Central Asian republics, namely Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan, and Tajikistan, emerged from the 1991 Soviet dissolution with borders that Soviet nationalities policy had drawn on top of a preexisting Islamic cultural geography. The Central Asian contemporary positioning combines Soviet-era infrastructure legacy, Russian security expectations, Chinese Belt and Road investment flows, Islamic transnational networks, and Central Asian rentier-state dynamics in Kazakhstan and Turkmenistan hydrocarbon economies. The Central Asian positioning is not readily explained by any single framework and requires case-specific supplementary treatment across each republic.
Iran. The Iranian case combines the Middle Eastern oil-state resource-rent dynamic with the 1979 Islamic Revolution political-economic transformation, sustained American and Western sanctions across the post-1979 period, and the Iranian regional-power ambitions expressed through the axis of resistance network including Hezbollah, Hamas, the Houthis, and Iraqi and Syrian aligned militias. The Iranian nuclear program, the 2015 Joint Comprehensive Plan of Action and 2018 American withdrawal, and the 2020s Iranian-Israeli direct military conflict all operate greatly outside the industrialization-order framework.
North Korea. The North Korean case combines the Soviet forced-industrialization legacy, the post-1990 sustained economic isolation, the distinctive Kim dynasty political-economic configuration, and the nuclear-weapons and ballistic-missile programs that dominate North Korean international positioning. North Korean per-capita output remains considerably below the pre-1990 Soviet-era peak and constitutes one of the most persistent contemporary cases of divergent-club rather than convergent-club status.
Israel-Palestine. The Israeli-Palestinian case combines the 1948 Israeli independence and Arab-Israeli war, the 1967 Six-Day War and subsequent Israeli occupation of Gaza and the West Bank, the 1993 Oslo Accords and their subsequent breakdown, and the 2023-2025 Gaza war that has dominated the 2020s Middle Eastern political dynamics. The Israeli industrial-economic trajectory has been significantly successful with per-capita output reaching approximately fifty thousand dollars by 2024 and Israeli technology sectors including cybersecurity and semiconductors reaching global-scale competitiveness. The Palestinian economic trajectory has been substantially constrained by the occupation dynamics and territorial fragmentation and cannot be analyzed independently of the political-military conflict.
Common Mechanisms Where Industrialization Fails
The edge cases treated in this article share several structural features that distinguish them from the successful industrialization cases the earlier articles treated.
Resource-rent dominance. Multiple edge cases including the Middle Eastern oil states, post-Soviet Russia, several Sub-Saharan African cases, and Central Asian hydrocarbon states share the resource-rent dominance that produces distinctive political-economic configurations. The rentier-state dynamics, Dutch disease effects on manufacturing, and resource-price volatility all operate independently of any industrialization-order effect and produce the edge-case positioning outcomes.
Institutional legacy. Colonial-era institutional legacies dominate over industrialization-order effects across the Sub-Saharan African cases and marked portions of Latin America. The institutional-persistence mechanism the Acemoglu-Johnson-Robinson colonial-origins framework identifies operates on multi-century timescales and constrains what industrialization-order effects can achieve within the inherited institutional context.
Security-conflict dynamics. Ongoing security conflicts dominate the Israeli-Palestinian, Iranian, and post-2022 Russian positioning in ways that industrialization-order effects cannot override. The security-conflict dynamics produce distinctive alliance patterns, sustained resource commitments to military-industrial production, and constrained economic-development trajectories that require case-specific supplementary explanation.
Divergence-club persistence. The Sub-Saharan African, Central Asian, Iranian, and North Korean cases have not exhibited the convergent-club catch-up dynamics that industrialization-order framework would predict for economies with extensive resource endowments and human-capital foundations. The divergent-club persistence the Pritchett divergence-big-time analysis treated in the third article of the series formalizes applies at broad scope across the edge cases and constitutes the load-bearing empirical observation that industrialization-order analysis alone cannot explain.
The Framework Applied with Disclaimers
The six axes of the series opener apply to the edge cases only partially. The mapping requires explicit disclaimers.
Wave. Not applicable in the standard sense. The edge cases either did not industrialize markedly, as with Sub-Saharan Africa outside pockets, Central Asia except the Kazakhstani hydrocarbon sector, and Iran outside sanctioned technology sectors, or industrialized through distinctive mechanisms, as with Middle Eastern oil-state hydrocarbon extraction, Russian Soviet-legacy combined with resource-rent, and Israeli post-1948 technology sector.
Endowments. Dominant across most edge cases. Hydrocarbon endowments dominate the Middle Eastern, Russian, and Central Asian cases. Mineral endowments dominate several Sub-Saharan African cases. Geographic and demographic endowments dominate the Israeli case within its contested borders.
Institutional response. Substantially inherited from colonial or Soviet-era predecessors across most edge cases. The Sub-Saharan African institutions appreciably inherit from colonial-era extractive designs. The post-Soviet institutions greatly inherit from the Soviet configuration. The Middle Eastern rentier-state institutions inherit from the 1970s oil-boom period consolidation.
Wartime disruption. Substantial and ongoing across several edge cases. The Israeli-Palestinian, Russian-Ukrainian, Yemeni, Sudanese, and Democratic Republic of the Congo conflicts constitute sizable ongoing wartime disruption. The Iranian regional-conflict engagement across Yemen, Syria, Lebanon, and Iraq constitutes a distinctive sustained-conflict pattern.
Catch-up mechanism. Not applicable in the standard sense for the divergent-club edge cases. The resource-rent-based per-capita accumulation the Middle Eastern oil states and some others exhibit is not catch-up in the industrialization-order sense but constitutes an alternative development pattern with distinctive characteristics.
Contemporary positioning. Substantially determined by supplementary factors including resource endowments, institutional legacies, security-conflict dynamics, and specifically regional-power engagements rather than by industrialization order. The edge-case positioning requires case-specific explanatory frameworks tailored to the operative supplementary mechanisms.
Conclusion
The industrialization-order framework the series has applied across the first ten case articles carries appreciable explanatory weight for the industrialized economies but reaches its explanatory limits for the resource-rent-dominant cases, colonial-legacy-dominant cases, security-conflict-dominant cases, and divergent-club-persistent cases treated in this article. The primary-structural framing the series opener established correctly anticipated these limits and identified the load-bearing supplementary explanations that carry the argumentative work in each cluster.
The Middle Eastern oil-state, post-Soviet Russian, Sub-Saharan African, Latin American non-industrialized-cluster, and Central Asian cases all require supplementary explanation beyond industrialization order. The Iranian, North Korean, and Israeli-Palestinian cases require case-specific supplementary treatment. Any comparative political-economy framework claiming universal applicability across all cases would considerably overreach its evidentiary support, and the primary-structural framing this series has applied preserves the model’s utility for the cases where it works while explicitly acknowledging where it does not.
The twelfth and final article of the series takes the contemporary global snapshot as of 2026, applies the series framework to contemporary positioning of the major powers and blocs, extrapolates forward under this formulation, and treats competing extrapolation strategies from Kotkin, Sachs, Perez, Smil, Zeihan, and other analysts as illustrative alternatives to the industrialization-order strategy. The twelfth article also revisits the primary-structural-not-sufficient framing in light of the edge cases treated in the current article, and identifies the load-bearing open questions the treatment leaves for future analysis.
References
- Related Post, Framing and the Preindustrial World
- Related Post, India and the Late Arrivals
- Related Post, Soviet Forced Industrialization
- Acemoglu, Daron, Johnson, Simon, and Robinson, James A., The Colonial Origins of Comparative Development, An Empirical Investigation, American Economic Review 91, 2001
- Nunn, Nathan, The Long-term Effects of Africa’s Slave Trades, Quarterly Journal of Economics 123, 2008
- Ross, Michael L., Does Oil Hinder Democracy, World Politics 53, 2001
- Sachs, Jeffrey D. and Warner, Andrew M., Natural Resource Abundance and Economic Growth, National Bureau of Economic Research Working Paper 5398, 1995
- Sokoloff, Kenneth L. and Engerman, Stanley L., Institutions, Factor Endowments, and Paths of Development in the New World, Journal of Economic Perspectives 14, 2000