National identity and the political economy of small states

ABSTRACT

Building on insights from Katzenstein and Gellner, the authors theorize that small, culturally homogeneous countries with a strong national identity have institutional advantages that tend to enhance their long-term socioeconomic performance. They can coordinate policy in ways that help them respond successfully to external vulnerabilities by building institutional capacities for cooperation, sacrifice, flexible maneuvering, and concerted state action in the national interest. The emphasis on culture and national identity is an important innovation in understanding the political economy of small states. The theory is illustrated by means of an extended analysis of Denmark.

KEYWORDS:

• National identity
• nationalism
• culture
• small states
• political economy

ACKNOWLEDGEMENTS

Thanks for comments on previous drafts go to Denise Anthony, Lars Bille, Francesco Duina, Lars Bo Kaspersen, Bill Kissane, Atul Kohli, Ove Korsgaard, Gunner Lind, Peter Bugge, Frank Trentmann, Tony Masi, Brendan O'Leary, Ove Pedersen, participants of the Dickey Center International Relations Seminar at Dartmouth College, participants of the Conference on Scale and Nation, Dartmouth College, and the journal's anonymous reviewers.

Notes

¹ Our objective dimensions can be contrasted with relational ones (i.e. size relative to other countries) or subjective ones (i.e. self-perception of size), which are more difficult to measure (e.g. Neumann and Gstöhl, 2004).

² There are methodological problems with such indexes (e.g. Cederman and Girardin, 2007; Fearon et al., 2007; Posner, 2004), but they are of little consequence here insofar as Denmark is widely recognized to be a very homogeneous society.

³ What are considered ‘important’ social aspects of performance may differ across societies, but we suspect that there would be general agreement on most if not all of the things we have listed.