Rentier Fragility, Institutional Vulnerability and Underdevelopment: A Political Economy Analysis of Nigeria, 1986–2025

This study interrogates the political economy dynamics shaping Nigeria’s persistent underdevelopment from 1986 to 2025, focusing on how rentier fragility and institutional vulnerability combine to undermine structural transformation. Anchored in Political Settlement Theory (PST) and Neopatrimonial/Rentier Political Economy (NPE/RPE), the paper analyzes how elite bargains, distributive conflicts and rent-driven incentives have produced a governance equilibrium that sustains fragility rather than development. Using a qualitative design supported by high-impact scholarly analyses, institutional reports (World Bank, IMF, UNDP, NNPC, CBN, NEITI) and reputable media sources, the study finds that Nigeria’s rent-dependent political economy generates weak institutions, fragmented accountability systems, prebendal politics and recurrent violent conflicts that reproduce cycles of underdevelopment. Since the adoption of the Structural Adjustment Programme in 1986, political and economic reforms have been repeatedly subverted by elite coalitions that benefit from extractive arrangements. The analysis shows that institutional vulnerability is not accidental but structurally embedded within Nigeria’s rentier political settlement, where state capacity expands or contracts depending on elite interests rather than developmental objectives. The paper concludes that Nigeria’s underdevelopment persists because reforms confront deeply entrenched incentive structures that reward fragility. It recommends building inclusive political settlements, insulating economic governance institutions from rent-seeking pressures, strengthening rule-enforcement mechanisms and reconfiguring fiscal federalism to incentivize productive investment and accountability. Keywords: Rentier state, political economy, institutional vulnerability, political settlement, Nigeria, underdevelopment, elite bargaining.