State Capture

The concept of state capture has been used in political science literature as referring to the way in which private, often corporate, power has dominated public policy making. Thus, the phenomenon of state capture was described in the early critique of pluralist scholars. Pluralism's claim was that a multiplicity of interest groups prevented any particular group from being dominant. However, the counterargument is that interest groups are not equally endowed with resources. Many commentators argue that business represents a very strong power system—far stronger than any other social group or institution—that challenges and threatens to dominate public power. The term “capture” describes how public bureaucracies have become dominated by strong and powerful interest groups. In a context characterized by a complex multitude of interest groups, the bureaucrats tend to deal with the best-organized groups as a way of reducing complexity. State capture has been used in the critique of corporatism as well. Corporatism refers to the permanent representation of well-organized hierarchical interest groups in the state apparatus, a phenomenon that may be seen as a way of the state giving in to specific interests. Both the critics of pluralism and of corporatism argue that private corporate power must be controlled by democratic institutions.

In the literature on postcolonial societies, the concept of state capture refers to the fact that neopatrimonial rulers tend to favor their own ethnic or regional group rather than the nation as such; the state is thereby captured by a specific group. A weak state may be the most prone to be captured by interest groups or even by strong individuals. A relatively strong, institutionalized state may therefore be necessary in order to avoid state capture. An institutionalized party system also may be important, for where parties are weak, traditional forms of elite interaction tend to prevail, enabling elites to capture the state apparatus.

State capture has recently been related to the postcommunist region where it describes the way the policy process, for example of privatization, has been dominated by powerful oligarchs that belonged to the old nomenklatura elite. Joel Hellman and colleagues thus defined state capture as a situation in which decisions are made to appease specific interests, maybe even through illicit and nontransparent private payments to public officials, rather than to the national interest aggregated and mediated through a democratic process. State capture takes place when the basic rules of the game are shaped by particularistic interests rather than by the aggregated national interest.

The literature on governance focuses on how authority migrates away from the central state both upward to supranational organs, downward to subnational units, and outward to civil society interest groups. The notion of state capture is conspicuous for its absence in this literature that mainly emphasizes the win-win potential of state-society networks. However, societal actors in the networks may well take over, and hence capture, decision making and implementation. In the World Bank, state capture is seen to be closely related to governance, particularly corruption, because giving in to particular interests often involves the use of public means for private purposes, which is the essence of corruption.

...