The Paradox of Elite Capture: A Double-Edged Sword
In contemporary socio-political and economic discourse, the role of elites and the elite capture remains highly contentious in shaping strong governance structures and developing markets. Most of the literature on elite capture characterized it as a phenomenon where resources that are transferred to the masses are usurped by those who are politically or economically more powerful. The power is perpetuated through land holdings, family networks, employment status, wealth, political and religious affiliation, personal history, and personality.
Theoretically, as DiCaprio (2012) explains, these powerful actors use their elite status and ability to control resources. Their command over productive assets and institutions enables them to steer the distribution of both resources and authority. Co-optation among common interest networks to achieve their goal further strengthens and empowers these elite groups. The contributing factors to this are voter ignorance, electoral uncertainty, and embezzlement of campaign funds. In South Asian and African contexts, strategic distortion of local information creates informational asymmetry, which allows the elite to manipulate the outcomes. Embezzlement of external resources, especially from donor-induced development or community projects, adds to this influence.
Numerous studies identify the elite capture as a significant barrier to equitable growth, income equality, and economic development, whereas some studies shed light on the significance of elites as a potential driver for equitable growth and income equality. These perspectives present two contrasting narratives of elite capture. One is a potential engine of growth and a driving force for society, and the other as a barrier to equitable development. This duality of elite capture raises some fundamental questions: are elites crucial drivers of innovation, progress, and economic development? Or do they perpetuate rent-seeking inequality, power, extraction, and appropriation?
To understand the complexity of elite capture and unravel its associated nuances, it is essential to first define who the elites are. Various scholars have provided differing interpretations. Some of these thorough studies have been carried out by PIDE. Zulfiqar and Moosvi (2022) summarize major definitions in their study identifying, elites based on caste, class, wealth, land holdings, and political connections. These definitions of elites represent elites as dominant groups that disproportionately influence development processes, and distribution of resources due to their superior social, economic, or political status
In the Pakistan context, an insight comes from scholars like Armytage (2020) who defines the elite class as those belonging to families who generate at least U.S. 100 million dollars in revenue per year. Similarly, during a session on elite capture organized by PIDE at EconFest (2023) political journalist Habib Akram, in conversation with Dr Nadeem ul Haque, offered a further elaboration of this view. He describes Pakistani elites as people who have secured their elite status through manipulation and exploitation. This manipulation and treachery, according to Akram, makes elite capture particularly more problematic in the case of Pakistan as it entrenches inequity and undermines merit-based growth.
