Rentier state

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Rentier state is a term coined by Hossein Mahdavy in 1970. This theory defines rentier states as those countries that receive on a regular basis substantial proportions of their total national revenue from the rental of indigenous resources to external clients.

An example of this type of rental is the payment for passage of ships through the Suez Canal.

The term 'rentier state' can also be applied more broadly to states which receive income from dealing in valuable natural resources such as oil, or financial instruments such as reserve currency or strategic resources such as military bases.

The more general term 'rentier' originally referred to an individual living on income from property or from other investments.

See also