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Oligarchy is a form of government where most political power is effectively vested in a small segment of society (typically the wealthiest or most ruthless segment). Oligarchies are often controlled by a few powerful families whose children are raised and mentored to become inheritors of the power of the oligarchy, often at some sort of expense to those governed. This power may not always be exercised openly, the oligarchs preferring to remain "the power behind the throne," exerting control through economic means. It has also been suggested that most so-called communist countries fit the definition of oligarchy, in that the most ruthless segment of society comes to power by overthrowing other oligarchs (usually and historically: capitalists).

A society may become an oligarchy by default as an outgrowth of the shifting alliances of warring tribal chieftans, although any form of government may transform into an oligarchy at some point in its evolution. The most likely mechanism for this transformation is a gradual accumulation of otherwise unchecked economic power. Oligarchies may also evolve into more authoritarian forms of government, sometimes as the result of one family gaining asendency over the others. Many of the European monarchies established during the late Middle Ages began in this manner.

Oligarchies may also become instruments of transformation, insisting that monarchs or dictators share power, thereby opening the door to power-sharing by other elements of society. One example of this process occurred when English nobles banded together in 1215 to force a reluctant King John I of England to sign the Magna Carta, a tacit recognition both of King John's waning political power and of the existence of an incipient oligarchy. As English society continued to grow and develop, the Magna Carta was repeatedly revised (1216,1217, and 1225), guaranteeing greater rights to greater numbers of people, thus setting the stage for British constitutional monarchy.

A modern example of oligarchy can be seen in South Africa during the 20th century. Here, the basic characteristics of oligarchy are particularly easy to observe, since the South African form of oligarchy was based on racism. After the Boer War, a tacit agreement was reached between English- and Afrikaans-speaking whites. Together, they made up about twenty percent of the population, but this small percentage had access to virtually all the educational and trade opportunities, and they proceeded to deny this to the black majority even further than before. Although this process had been going on since the mid-18th century, after 1948 it became official government policy and became known worldwide as apartheid. Even since the advent of democracy in South Africa in 1994 and the handover of political power to a black government, whites have largely maintained their hold on economic power, sharing this only with a small group of blacks.

See also: dictatorship, monarchy, democracy, crony capitalism, theocracy, anti-communism