Economic Adjustment and Political Transformation in Small States

The smaller countries of Western Europe have a reputation for being more successful than their larger neighbours. They are wealthier per capita, they are more stable politically, and they are more flexible economically. The secret to this success lies in their consensual style of politics and their corporatist style of decision-making. Unfortunately, however, that may be about to change. A political transformation underway in small states is undermining the politicsof consensus and breakdown the effectiveness of corporatist institutions. Small countries are becoming increasingly vulnerable to the vicissitudes of world markets as a result.Belgium and the Netherlands offer clear examples of the problem at hand. The political societies of both countries were tightly organized to avoid conflict and to promote consensus. Over time, however, this tight organization has broken down, politicians have opted for conflict over consensus, and elections have become more volatile as a result. In turn, this political transformation of Belgium and the Netherlands has undermined their traditional approach to economic policymaking andeconomic adjustment. Belgium and the Netherlands are now more vulnerable to world market forces than at any time since the end of the 1970s. Their relative economic and political success can no longer be taken for granted. The relative success of other small states should be brought into question aswell.

This is a valuable book, which deserves to be read by scholars and students interested in policy-making in Belgium and the Netherlands as well as those interested in the political development of small European states and the complex interplay between various domestic interest groups and institutions, and between the national and European levels of policy-making more generally.

Erik Jones is Professor of European Studies at the SAIS Bologna Center of the Johns Hopkins University. He has taught previously at the University of Nottingham and the Central European University and he was a research fellow a the Centre for European Policy Studies in Brussels.