Even among high-income rentier states, the Gulf states are characterized by a unique demography: No other states in the world are so rich while at the same time having such low wage levels on large segments of their private labor market. No other systems in the world have opened the floodgates of international labor migration to the extent the GCC monarchies have, resulting in the domination of private labor markets by non-citizens. This confronts the Gulf monarchies with a unique set of development challenges that are both economic and political, and that have been thrown into increasingly sharper relief in recent years. Issues of demography and labor market policy have become crucial not only for the long-term socio-economic prospects of Gulf nationals, but are also increasingly linked to the burgeoning debate about national identity and security in the GCC countries. Currently, all Gulf governments afford socio-economic protection to their national population through a number of mechanisms: privileged public employment, the de facto provision of better labor rights and, in many cases, entitlements to subsidies and cost-free public services not available to foreigners to the same extent. Many of these measures impose a significant fiscal burden on Gulf governments. Arguably more important, they exacerbate the existing segmentation of national and non-national populations in Gulf monarchies, which is unparalleled in scale and depth among modern nation states.