Clientelism and Predation in Algeria: Public versus Private Sector

This paper aims to highlight the unique link between the public and private sectors in a rentier economy administratively regulated by an authoritarian political regime, such as the Algerian one, rather than by the laws of the market. The following questions are put forward: How can this situation be explained, and what impact does it have on the way the country’s private sector operates?

• Our analysis is based on the assumption that the Algerian economy does not operate according to the laws of the market but according to the administrative injunctions of the state. The political regime born of independence in 1962 is authoritarian, turning economic resources into a political lever for the ruling elites to maintain power and to use state resources for personal ends.

• In the absence of a public space allowing for the expression of conflicting interests within civil society and demarcating the boundaries between the latter and the political system, the economy at large remains hijacked for political ends, serving the immediate interests of the ruling elite.

• Consequently, the public and private sectors are subjected to systematic exploitation by the regime’s political elites. This undermines the profitability of capital and the productivity of the economy, thereby condemning the country to continued dependence on both oil revenues for foreign currency inflows and international markets for essential supplies.

Context

Economic theory defines the difference between the private and the public sector in terms of the legal ownership of capital. In other words, the public sector’s means of production are owned by the community through the state while those of the private sector are in the hands of entrepreneurs, who are members of civil society. This distinction between the categories of “public” and “private,” inspired by Western experience, appears insufficient to account for the reality of most countries whose state-building processes have followed paths different from those experienced in the Western world.

English version: Clientelism and Predation in Algeria: Public versus Private Sector

French version: Clientélisme et prédation en Algérie : Secteur public vs secteur privé

Arab version: الزبائنية و السلب في الجزائر: القطاع العام مقابل القطاع الخاص