Do domestic institutions affect how dictators respond to their political opposition? In this paper, I argue that institutionalization is key to understanding whether dictators respond to domestic opposition groups with concessions. I present a nominal typology of dictatorial opposition movements, arguing that the manner in which the opposition is incorporated into the regime reveals important information about the types of concessions dictators will likely provide. Using a system of endogenous equations, I show that dictators buy off some types of domestic opposition with material concessions and liberalize when they face other types of opposition. Because dictators often make decisions facing environmental constraints, however, I also argue that financial conditions can limit a dictator’s ability to respond beneficently to the opposition.