The state and market in Oman's development: Conflict or co-operation?

This thesis is a theoretically grounded empirical analyses of the economic and social development of Oman particularly from the mid-1970s to 1995. The analyses focuses on the major factors responsible for Oman's development particularly its development policy and strategy which involved a systematic use of both the state via the Five Year Plans and the market in inducing economic and social development of the country. These instruments were crucial in the allocation of resources to the various economic and social sectors of the country which secured relatively high rates of economic and social development. A brief historical sketch of Oman's economy and society highlights the significant transformation that the country has undergone since the inception of development planning in the mid-1970s. The study is located within the context of the global economy and international policy and provides in particular a critical reappraisal of structural adjustment propagated by the major world organisations such as the World Bank and the International Monetary Fund. In this connection the thesis provides a critical appraisal of the 'market-friendly' 'minimal state' policies promoted (and required) by provisions under conditionality. After analysing the role of the state in the development of some countries to provide a comparative dimension, the study cautions against unselective or universal adoption of structural adjustment and the privatisation package and hence a reduction in the role of the state, which is supported by the Bank and International Monetary Fund or national governments. The research critically appraises the various theories of development from both the development economics and development studies tradition; the study evaluates the plan versus the market debate in relation to both the two theoretical traditions and international policy of structural adjustment, and the theoretical assumptions underlying this. The thesis shows the importance of the role of the state in securing economic and social development including in some East Asian Countries. After analysing Oman's strategy in combining the strengths of planning and the market processes in securing development, the thesis argues that contrary to the neo-classical viewpoint now dominant, the case for rolling back the state is questionable. On the contrary the thesis recommends a proactive role for the state, in a number of spheres of Oman's economy and society including in industry and agriculture. Specifically the research findings describe how a number of five year plans have succeeded in both expanding and diversifying Oman's oil-dependent economy as reflected in various indicators such as increase in per capita income and gross national product, and in increasing social welfare as indicated by greater provision of education and health services in the country. The thesis finally offers some suggestions and recommendations in terms of dealing with future problems that Oman have to encounter, including unemployment, need for more (appropriate) trained labour force and greater diversification of the economy