Do you think the Lannisters’ limitless gold wealth has promoted rentierism in the Westerlands analogous to that seen in oil-rich countries today? Are the Lannisters less dependent on their bannermen than other Great Houses? Tywin’s personal grudge against loans notwithstanding, would you predict such wealth to lead to redistributive rather than productive tendencies in the Westerlands economy? While a seeming strength, has it prevented the development of strong institutions in the long run?

Excellent question! No, it hasn’t, for the most part, because of the extreme financial conservativism of House Lannisters, which I’ve covered here. This is the key quote:

“…some borrowed heavily from Casterly Rock, then failed to repay the loans. When it was seen that Lord Tytos was willing to extend such debts, even forgive them, common merchants from Lannisport and Kayce began to beg for loans as well.

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Given their enormous liquid reserves, it came as something of a shock to find out that it was seen as a major (and negative) departure from policy for the Lannisters to loan money to their commercial sector. While dumping all of their reserve onto the market at once would be a bad idea, not providing any liquidity to the merchant class has beyond a shadow of a doubt held back the economic development of the Westerlands economy.

So how do the Lannisters use their wealth? Well, certainly they are less dependent on their bannermen, although as Tytos showed, it’s not a good idea for them to let their bannermen get away with not paying their taxes. But mostly, the Lannisters use their wealth for political advantage, lending out money to houses within and without the Westerlands in exchange for political favors.