Synopsis:
Why are small and culturally homogeneous nation-states in the advanced capitalist world so prosperous? Examining how Denmark, Ireland, and Switzerland managed the 2008 financial crisis, The Paradox of Vulnerability shows that this is not an accident. John Campbell and John Hall argue that a prolonged sense of vulnerability within both the state and the nation encourages the development of institutions that enable decision makers to act together quickly in order to survive, especially during a crisis. Blending insights from studies of comparative political economy and nationalism and drawing on both extensive interviews and secondary data, Campbell and Hall support their claim by focusing on the three states historically and, more important, in their different responses to the 2008 crisis. The authors also devote attention to the difficulties faced by Greece and Iceland. The implications of their argument are profound. First, they show that there is a positive side to nationalism: social solidarity can enhance national prosperity. Second, because globalization now requires all states to become more adaptable, there are lessons here for other states, large and small. Lastly, the formula for prosperity presented here is under threat: highly homogeneous societies face challenges in dealing with immigration, with some responding in ways that threaten their success. The Paradox of Vulnerability demonstrates how the size and culture of a nation contribute in significant ways to its ability to handle political and economic pressures and challenges.
Review:
"This important and lively book develops a compelling argument about the complex relations between vulnerability and national cohesion. With a focus on how Denmark, Ireland, and Switzerland coped with the effects of the financial crisis of 2008, The Paradox of Vulnerability demonstrates how and why some capitalist states succeed in difficult times."--Peter J. Katzenstein, Cornell University
"What enables some small countries to survive global economic forces over which they have no control? Campbell and Hall's answer to this significant question is both sobering and hopeful, and focuses on societies with robust national institutions. This is a well-researched and well-written book."--Bruce G. Carruthers, Northwestern University
"Why are some states and not others able to withstand economic vicissitudes such as the 2008 financial crisis? This important book argues that small states perceive an intense vulnerability to external forces, which fosters national solidarity even under conditions of ethnic diversity. Enriching our understanding of the 2008 global crisis and of economic life more broadly, this book offers new perspectives on effective institutions and is a welcome corrective to the view that diversity is an impediment to national cohesion."--Prerna Singh, Brown University
QUOTE: "This excellent book delivers an unprecedented analysis of the reaction of small countries in Europe to the financial crisis of 2007-08. A major contribution to a number of debates and research areas--by two of the world's most established political and economic sociologists--it will become a major reference point for many years to come and will no doubt reach well beyond academia."--Francesco Duina, Bates College
"The Paradox of Vulnerability makes an important contribution to our understanding of why different states respond differently to similar economic shocks, and it starts an important conversation that we will want to address in this postcrisis--or between-crisis--period."--Erik Jones, Johns Hopkins University
"There is much to reflect on in this book. . . . [It] is a small, but a useful, addition to the stock of knowledge around what we must hope will be the defining financial crisis of this century."---Michael Reddell, Central Banking Journal
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