In the late 1980s, the concept of embedded autonomy became centrnl to the literature of economic development in East Asia. Rapid economic growth in South Korea, Taiwan and Japan was attributed to the state role in development (Johnson 1982, Wade 1990, Evans 1985). The state embedded itself in the social networks of the entrepreneurs. This model of the developmental state credit that the success in East Asia to the state's stmcture and role in prioritizing the achievement of rapid economic development as a national goal, exerting control over private capital, and acquiring a strong administrative bureaucracy that was built on merit and protected from political influence (Polidano 1998, Wade 1992, Evans et al 1985, Henderson and Appelbaum 1992). In the original formulation of the concept of embedded autonomy, the state embeds itself in the surrounding social networks and directs it to facilitate industrial transformation and thus, boost its economy.
On the other extreme, the Egyptian case provides a contrary example to the Evans model when in the mid-1980s as a new phenomenon emerged where businessmen attempted to embed themselves within the state administration. With the beginning of the privatization program, the capacity of the local entrepreneurial class increased. In order to protect their interests, the new business elites decided to get involved in the political stmcture by joining the dominant party (The National Democratic Party, NDP) and to run as NDP candidates for the People's Assembly. The number of businessmen in the parliament increased from 31 in 1995 to 77 in 2000 and the current assembly as of 2007 includes 68 businessmen. Another six have been appointed as Ministers in the last Nazif Cabinet (2005). More specifically, the appointment of businessmen as Ministers indicates a reversal of the trend for the state to embed itself in business social networks for a trend of business embedding itself in the administrative structure of the government. Moreover, these businessmen were appointed for Ministries that parallel their own fields of expertise. For example, the Minister of
Health is the owner and director of the most important hospital in Cairo. These kinds of appointment give a suspicion of cronyism. 1 This research seeks to explore the emergence of this new circle of elites in the Egyptian politics and its impact on economic development in Egypt. Given the state's lack of autonomy form the private entrepreneurial groups, how can this enhance or deteriorate the states capacity to boost the economy and what implications do these have on the government's economic policy. Using Egypt as a case study, this research will investigate the claims that (a) state autonomy can be limited by the business-state relations and accordingly that cronyism can affect the role of the state in economic development. This thesis will argue that business-state relationship in Egypt does curtail the role of the state in economic development due to the embeddedness of the business class in the government administration.
Political Science Department
MA in Political Science
Date of Award
Online Submission Date
Committee Member 1
Committee Member 2
Committee Member 3
viii, 114 leaves
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(2008).Business-state relations and development [Thesis, the American University in Cairo]. AUC Knowledge Fountain.
Negm, Yasmine Mohamed Ali. Business-state relations and development. 2008. American University in Cairo, Thesis. AUC Knowledge Fountain.
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