Did the threat of war trigger the extraction-coercion cycle? In this chapter I use a panel of Latin America from 1830 to 1913 to test the effects of looming international threats on domestic taxation and internal conflict. It is believed that due to the availability of foreign loans and taxable imports, states in the region did not have to engage in extraction from the local population, nor did they have to coerce individuals to comply with such policies. I summarize this argument in the form of testable hypotheses and point to factors—naval blockades and sovereign debt defaults—that might have hindered access to such external resources. I then focus on militarized interstate disputes (MIDs) and how they affected revenues, tariff levels, foreign loans, civil wars, coups, etc. My analyses show MIDs had a negative effect on tariffs and revenue and diminished the likelihood of a new loan—all results that contest the established conventional wisdom. Conversely, MIDs are associated to currency depreciation—a domestic-oriented inflationary tax—and domestic conflict—in particular, civil wars and coups. The chapter shows war did trigger the extraction-coercion cycle.

Of the two parallel lives, it is Hannibal who used an elected position to carry through political and economic reforms unwelcome to the ruling oligarchy, whereas Scipio was quiet and accepting of the status quo. A story that Hannibal was prosecuted after Zama is not believable. He urged acceptance of the peace terms after Zama, manhandling an opposing speaker; he apologized for this, pleading long absence from civil life. As elected ‘praetor’ (sufete), he antagonized powerful citizens. His summons of a ‘quaestor’ (financial official) was refused. Scipio, soon after, also had trouble with a recalcitrant quaestor. Hannibal’s main political reform was to end life tenure of the ‘judges’. Economically, perhaps using skills developed when managing the logistics of his Italian campaign, he calculated Carthage’s revenues and ended embezzlement. The unpopularity with the ruling class so generated, and Roman diplomatic pressure, caused him to flee permanently. Carthage’s second-century economy is evaluated.

This chapter presents a series of empirical analyses to test nationalization's primary effects on revenues and secondary effects on political survival. It begins by assessing the claim that nationalization will foster greater government take of resource revenues compared to maintaining operations by private firms. It then examines whether this corresponds to a higher probability of leadership survival: if nationalization increases state capture of resource revenues, then it should be the case that leaders use this wealth to consolidate power and prevent ouster. Beyond the survival of political leaders, it should also be true that political regimes in general will be stronger if resources are nationalized. These hypotheses are tested using the complete cross-national NOC dataset in conjunction with existing data on government revenues, the breakdown of regimes, and leadership survival. The empirics support the theory: nationalization increases state capture of resource revenues and increases the likelihood of survival of leaders and their political regimes. The results suggest that nationalizing operations explains why resource-rich leaders survive in some countries but not others.

How does nationalization of operations causally increase government revenue? Using the case of oil politics in prerevolutionary Iran, this chapter analyzes production elasticity and reduced informational asymmetries after the Shah of Iran nationalized the oil operations of BP and its partners. The chapter draws on a combination of conversations documented in archival records and quantitative analysis of historical fiscal data from the BP Archive. It begins by explaining the Shah’s surprise decision in January 1973 to reconfigure the National Iranian Oil Company from its role as a passive observer to a fully operational oil company able to set production levels and prices. The chapter then presents findings using BP’s revenue projections as counterfactuals to estimate the causal effects of the Shah’s decision with respect to whether NOC reform increased government take of oil revenues in 1974–1975 and whether revenues collapsed after retaliation by international oil companies in 1976 to strip the NOC of its ability to sell oil on the global market. The chapter illustrates both the nuances and consequences of operational versus nonoperational NOCs for fiscal strength.