Oil Funds and their Applications as Tools for Controlling Rent-Seeking and Corruption

If a society whose financial resources are hugely dependent on oil revenues is placed in a process that can not be supervised, rent-seeking and corruption rise in it and the economy is faced with severe economic fluctuations which in turn reduce the economic growth. Although rent-seeking exists in economy, it is necessary to reform and promote the structures which are actually the characteristic tools of development especially n the realm of economics. It is not possible to achieve such promotion of the structures without having access to a proper financial flow. Since the economic structure of Iran is the one dependent on oil and the rent obtained from oil and the fact the existence of various parallel institutions has made the economic environment of the country non-transparent, it seems to be essential to offer a solution to get out of the problem. In the present article, first the role of the oil revenues and curbing rent-seeking and corruption is described with an emphasis on the role of oil in the Iranian economy and then the efficiency of the use of an oil fund in order to decease instability and curbing the rent-seeking and the corruption caused by the oil revenues as well as reforming financial and economic structure of the government will be dissected.