This article advances theoretical understanding of exclusionary politics in rural locations through an institutional analysis of adaptation to climate change in Costa Rica's rice economy. It describes how crony capitalism evolved in state-sponsored rural development as the national economy moved towards a new neoliberal model. Cronies reorganized rice production and re-appropriated capital flows. As smallholder farmers were marginalized in the rice economy, their reliance on the state for irrigation water made them vulnerable to drought. As the state adapted its water allocation scheme to drought conditions, it determined who would profit and who would lose their livelihood. The authors use this analysis to argue that climate change adaptation is a normative process that may be used to justify coercion and control of specific classes of people. To understand this process, current adaptation frames must be broadened to include the organization of production and the appropriation and realization of capital flows. This broadening facilitates an understanding of how climate change adaptation strategies produce stratified class structures; some classes are made vulnerable to climate change while others profit. Breaking with the common refrain in much of the critical literature on neoliberal development, the authors argue that state responses to neoliberal change — not just neoliberal change itself — must be increasingly incorporated into critical development studies of rural transformations.
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