The “Rentier State” and “Rentier Mentality” in the GCC Oil States The term “rent” relates to “income derived from the gift of nature” or in other words “rent as pure luck.” The term “rentier state” refers to a situation in which the rental incomes, which largely dominate the governmental revenues, are external to domestic production. Although some rental income exists in any country, in the GCC oil states, rental income - stemming predominantly from oil revenues - amounts to at least 80% of total direct governmental revenues. The fact that the rent is external is crucial as it enables the economy to exist without a strong internal productive sector. Consequently, in a rentier economy, the scale of the national income does not reflect the performance of the domestic economy, but it is rather a function of the price of the rentier resource in the international market. Thus, a “rentier government” does not deal with the redistribution of internal resources through taxes on income and commodities on the one hand and supplying various so- cial services, subsidies and allowances on the other, in return for political participation. It rather mainly deals with the distri- bution of the external rental incomes among the indigenous population in the most beneficial political manner. Conse- quently, in the GCC countries, “a rentier mentality” emerged in which the government was not a political representative body, but rather a supplier of allowances, subsidies and various services which were free of charge in exchange for con- cessions regarding political participation on the part of the citizens. Hence, citizenship in a rentier state became a source of direct and indirect financial benefits. A major tool to distribute the rental wealth among the citizens is through employ- ment in the public sector which offers to its national employees high salaries and luxury work conditions without any work- reward causation. A highly rewarded job in the public sector is the key component of the “social contract” between the GCC royal families and their citizens. These are jobs for life. In addition, nationals do not have to pay income taxes. In re- turn, the state, namely, the ruling family, expects citizens to be totally loyal. The political implication of a rentier state is thus “no taxation and no representation”