By the early 1980s the average American had a lower standard of living than the average Norwegian or Dane. Standards of living in the Netherlands, Belgium, Sweden, Switzerland, and Austria also rivaled those in the United States. How have seven small democracies achieved economic success and what can they teach America? In Small States in World Markets, Peter Katzenstein examines the successes of these economically vulnerable nations of Western Europe, showing that they have managed to stay economically competitive while at the same time preserving their political institutions. Too dependent on world trade to impose protection, and lacking the resources to transform their domestic industries, they have found a third solution. Their rapid and flexible response to market opportunity stems from what Katzenstein calls "democratic corporatism," a mixture of ideological consensus, centralized politics, and complex bargains among politicians, merest groups, and bureaucrats. Democratic corporatism is the solution these nations have developed in response to the economic crises of the 1930s and 1940s, the liberal international economy established after World War II, and the volatile markets of more recent years. Katzenstein maintains that democratic corporatism is an effective way of coping with a rapidly changing world, a more effective way than the United States and several other large industrial countries have yet managed to discover.

This book focuses on the state level analysing factors that determine small state survival and proliferation. It demonstrates theoretically, quantitatively, and historically that small state survival depends first-and-foremost on the structure and particular features of the states system in which the small state finds itself.

Smaller nations have a special place in the international system, with a striking capacity to defy the expectations of most observers and many prominent theories of international relations. This volume of classic essays highlights the ability of small states to counter power with superior commitment, to rely on tightly knit domestic institutions with a shared "ideology of social partnership," and to set agendas as "norm entrepreneurs." The volume is organized around themes such as how and why small states defy expectations of realist approaches to the study of power; the agenda-setting capacity of smaller powers in international society and in regional governance structures such as the European Union; and how small states and representatives from these societies play the role of norm entrepreneurs in world politics -- from the promotion of sustainable solutions to innovative humanitarian programs and policies..

Small States in and outside the European Union offers a broad overview of the small states problematic in Europe. It touches upon definition issues, history, security policy, neutrality, EU institutional aspects and also includes contributors from Central and Eastern European countries. It presents a thorough analysis of different scenarios for EU institutional reform and their repercussions on the influence of small member states. The comparative results are visualized in tables. The work contains several contributions from practitioners who give insight into policy games and issues of national sensitivity not usually covered by purely scholarly publications. The European environment has changed dramatically through the processes of regional integration and rising interdependence. Relations between European states both inside and outside the EU are governed as never before by rules, norms, and fixed procedures. The book investigates the consequences of these developments on the foreign and security policy of small states. Academics and professionals from Austria, Denmark, Finland, Ireland, Lithuania, Luxembourg, Slovenia, Sweden, and Switzerland, as well as from the European Commission and the Council of Ministers, elaborate on these issues. Institutional regulations and traditional power politics as well as the foreign and security policy traditions of the states concerned, including the question of neutrality, are investigated. In addition, the book identifies the main interests of small states in today's Europe and offers an overview of different strategies these states apply in the realm of foreign and security policy. The book is interesting for the case studies it offers as well as for the reflections it contains regarding fundamental questions of the essence of statehood in today's Europe.

The book focuses on the relations between small states and alliances. It is on why, how and under what conditions states engage in alliances. What are the benefits and costs of alliances? How are the benefits and costs of alliances allocated among their members? What determines who allies with whom? Can small states still pursue their own security interests within an alliance? Can they even become integral part of an alliance? Scholars, practitioners, policy-makers and advisors from several countries discuss these issues. They address historical, empirical and theoretical topics and give policy recommendations.

This book examines the security, defence and foreign policy choices and challenges of small states in NATO and its small partner states in the new security environment. The main aim of the book is to analyse how these states are dealing with current and emerging security challenges and how they might better prepare for these challenges. A special focus is on ‘new’ security threats and solutions, such as drones and hybrid warfare. Simultaneously, the book focusses on how small states are responding to emerging ‘old threats’, such as Russian aggression in its neighbouring states and increased activity in the North Atlantic. The book makes an attempt to answer questions like: How are the small states of NATO and its small partner states adjusting to the new geo-political and geo-economic environment? Do small states in NATO manage the tension between alliance commitments differently from small states that are not members of NATO? What are the core strategic interests of the NATO and non-NATO partner small states? The book is about the external dimension of inherent size-related difficulties in states and how small states compensate for their inbuilt structural weaknesses compared with their larger neighbouring states. One third of the member states of NATO are small and most NATO partner states are small states too. Small states frequently have a disproportionate effect on global politics and they are more often affected by global shifts of power, yet they have less resources available to address security challenges. The aim of the book is to enhance the understanding of the role of small states in the changing global international security environment. The book presents the theory of shelter (which is derived from the diverse and extensive literature on small states) and uses it to examine how small states respond to new and old security threats. Shelter theory addresses three interrelated issues of common concerns to small states: the reduction of risk before a possible crisis event, assistance in absorbing shocks in times of crises, and help in recovering after such an event. In short, shelter theory claims that small states need external shelter in order to survive and prosper. They are dependent on the economic, political, and societal shelter provided by larger states, as well as regional and international organizations.

At the close of the twentieth century, Denmark, Finland, and Ireland emerged as unlikely centers for high-tech competition. In When Small States Make Big Leaps, Darius Ornston reveals how these historically low-tech countries managed to assume leading positions in new industries such as biotechnology, software, and telecommunications equipment. In each case, countries used institutions that are commonly perceived to delay restructuring to accelerate the redistribution of resources to emerging enterprises and industries. Ornston draws on interviews with hundreds of politicians, policymakers, and industry representatives to identify two different patterns of institutional innovation and economic restructuring. Irish policymakers worked with industry and labor representatives to contain costs and expand market competition. Denmark and Finland adopted a different strategy, converting an established tradition of private-public and industry-labor cooperation to invest in high-quality inputs such as human capital and research. Both strategies facilitated movement into new high-tech industries but with distinctive political and economic consequences. In explaining how previously slow-moving states entered dynamic new industries, Ornston identifies a broader range of strategies by which countries can respond to disruptive challenges such as economic internationalization, rapid technological innovation, and the shift to services.