According to the well-known rentier-state theory, resource rich states are ruled by autocrats who distribute resources that are wrongly classified as “free” to selected groups of people in order to sustain power and private benefits. However, research on statehood in Africa, South America, the Middle East and Asia indicates that most states are captured by elites that use their political power to secure economic advantages. How can we analyzse policy in those regimes? It seems reasonable to analyze authoritarian states as profit-oriented organizations, notwithstanding their special relationship with their "clients". In order for authoritarian leaders to benefit, it is important for them to keep their position and to control the means necessary to extract profits. Both entail, first, the power to decide and second, the power to do something. Very simply put, the first demands a relatively weak but encompassing state, while the second calls for a strong state with an able and efficient bureaucracy. With an emphasis on various material and immaterial sources of power in principal-agent and agent-agent relationships, this paper focuses on Azerbaijan, for it is a prime example of post-Soviet resource-rich states, which, according to literature, are authoritarian quasi by default. From organizational theory follows that an organization tends to become less efficient the more coercive it needs to be. Further, the consolidation of power in organizations has interrelating internal and external dimensions. An economy of power is illustrated on the basis of various examples from Azerbaijan’s energy and electricity sector.
