Abstract: The wealthy oil states in the Arabian Gulf are commonly classified as classic rentier-states. This study examines whether the rentier state theory is able to explain the political and economic developments of Dubai.

Dubai showed the income structure of a rentier state until the mid-1980s and external rents today still count for a substantial part of the emirate’s revenues. However, Dubai has never shown a clear rentier state behavior. Even during times of high oil revenues, Dubai chose to invest in the productive sector and made use of available advantages to invest in economic diversification. Its economic policies have shown continuity since the 1950s. The rentier state theory is not able to satisfactorily explain the economic policies before 1985 and it is not clear if the policies after 1985 can be interpreted as a crisis management measure in accordance with the rentier state theory.

At the same time, it seems evident that in analyzing the development of Dubai, it is important to take into account the role played by other factors such as geography, history and the involved actors.