Theocratic regimes in Iran intentionally sacrifice their own wealth and survival to maintain ideological purity.
Standard economic models assume that ruling elites are rational actors who always prioritize staying in power. Ideological extractivism proves that some leaders value their religious or political dogmas more than their own bank accounts. These elites will sabotage their nation's economy and risk a total collapse of the state just to stay true to their beliefs. This behavior makes traditional sanctions and diplomatic pressure far less effective than they are against purely corrupt regimes. Understanding this motive is essential for predicting the actions of the world's most rigid governments.
Ideological Extractivism: How Theocratic Institutions Subvert Privatisation and Resist Adaptation in Iran (2005-2026)
SSRN · 6726279
Existing scholarship on extractive institutions (Acemoglu and Robinson, 2012) assumes that ruling elites are rational actors who instrumentalise ideology to sustain economic power. This paper argues that this assumption fails to account for regimes in which ideology functions not as an instrument of power but as its purpose. Introducing the concept of 'ideological extractivism', the paper identifies a distinct regime type in which extractive economic institutions are fused with a totalising reli