As Pastore (2013), and many others, such as Panke, have noted, the leaders of small states can influence the policies of the European Union (EU), even its foreign policies. This said, this often only occurs once organisational learning has occurred. Moreover, this influence is often done to serve objectives that are largely based on geopolitical considerations. In other words, when small states are not limited by their size, they are the prisoners of geography.
The case of Luxembourg, however, tells a different story. The Government of Luxembourg (GOL) is not very active in security matters. It has a small army, three pilots, and no security attachés in its embassies. In fact, former Prime Minister of Luxembourg, Jean-Claude Juncker, (who is now the President of the Commission of the EU) cared so little about security issues that he did not manage his state’s intelligence agency, resulting in illegal phone tapping, the misuse of public funds, corruption, blackmail, etc. He even said “the intelligence service was not my top priority. Moreover, I hope Luxembourg will never have a prime minister who sees SREL as [his or her] priority”.
Such a stance can be explained by the duchy’s location, at the centre of the EU, far from non-EU states and non-EU citizens. It can also be explained by the fact that the state is not really of great strategic interest to large non-EU states, and if it is, it will be as a location for indirect and direct investment. One can note, however, that crime has slightly risen in Luxembourg (and the number of people in prison has also increased), and that with it population growing at more than two percent per year, crime, including trans-frontier organised crime, is likely to increase even more.
As is well known, the GOL is very active in other EU policy sectors, and can be considered one the most ‘federalist’ EU member states. The love of the EU can partly be explained by Luxembourg’s national interest, but also by the ‘national’ identity of many Luxembourgers, who see themselves as Europeans, or at least see their culture as a mix of many neighbouring cultures (nb. many foreigners, i.e. non-citizens, work in Luxembourg). So one must not assume that the GOL is not active in EU politics. To the contrary, GOL officials are very active, with their pronouncements often being cited in the press and many summits and meetings being held in Luxembourg Ville (nb. Some EU and NATO organisations and agencies are also ‘seated’ in Luxembourg – the EU Court of Justice, for example).
Even when the GOL does engage in EU foreign policy, it seems to do so for ulterior motives. This is to say that its activities can be seen as a form of bargaining and trade, of buying favours. Thus, the GOL invests in military equipment, cooperates with Europol, exchanges intelligence on third-parties, etc., but rarely are any of these forms of cooperation directly related to Luxembourg’s interests. So beyond questions of EU identity and EU solidarity, or simple habit, one can also seen such actions and manoeuvres as a means of accumulating what Pierre Bourdieu called ‘social capital’, of currying favours.

In his well-known essay, Isaiah Berlin quotes the Greek poet Archilochus’ dictum that “a fox knows many things, but a hedgehog one important thing”. More recently, psychologists and commentators have confirmed this insight. The point is that when one commits to just one grand theory, one is often going to miss important information, and thus get many things wrong. Of course, the other danger with grand theories is that they might not stand the ‘test of time’. And if one has an emotional attachment to the theory, it will be difficult to face reality (cf. the confirmation bias).

Academia is replete with grand theories that are no longer applicable, but live on in the minds of a small group of academics. Economics is no exception to this phenomenon. Two such ‘theories’ (n.b. I use the term loosely) are neo-liberal theories of development (a.k.a. the Washington Consensus) and the more critical Dependency Theory. That the principles behind the Washington Consensus rarely have their desired effect is well-known – President Obama help bring attention to the fact that there was no consensus about ‘the consensus’. So best to focus on an alterative theory that is equally erroneous, i.e. Dependency Theory.

Of course, orthodox economists have already critiqued dependency theory - and many debates have followed, to the point that even the left-wing The Guardian newspaper admits that :

Classical dependency theory, which focuses on the relationship between rich and poor countries, probably needs substantial restructuring for the present era.

So I will focus here on a few facts that relate to recent changes in global economics. Indeed, it is the fact that many things have changed since the theory was developed that make it less correct and less applicable.

A first major problem is the fact is the poverty is decreasing worldwide. Although one can note a global increase in relative poverty, one can also note a decrease in absolute poverty, notably in Asia (see chart above).  

The second major problem is that many so-called 'dependent' states are also getting richer. I wonder how dependency theory could be used to explain economic growth in, for example, the BRICS (i.e. Brazil, Russia, India, etc.). Combined with this development, is the increased influence these states’ governments have obtained in international institutions and organisations, such as the International Monetary Fund (IMF), the World Bank (WB), and most of all the G20, which when Dependency Theory was written did not exist. India, for example, is an increasingly important actor in the IMF and the WB.  Or as Robert Wade puts it:

Many developing and transitional countries have grown faster than advanced countries in the past decade, resulting in a shift in the distribution of world income in their favor. China is now the second largest economy in the world, behind the United States and ahead of Japan. As the relative economic weight of China and several others has come to match or exceed that of the middle-ranking G7 economies, the world economy has shifted from “unipolar” toward “multipolar,” less dominated by the G7. How is this change being translated into changes in authority and influence within multilateral organizations like the G20, the World Bank, and the International Monetary Fund (IMF)? Alarm bells are ringing in G7 capitals about G7 loss of influence. According to a WikiLeaks cable from the senior U.S. official for the G20 process, from January 2010, “It is remarkable how closely coordinated the BASIC group of countries [Brazil, South Africa, India, China] have become in international fora, taking turns to impede US/EU initiatives and playing the US and EU off against each other.”

The third problem with Dependency theory is the argument that “core” states can afford to be liberal democracies. With the rise of illiberal parties and illiberal policies and laws throughout Europe and North America, surely this assumption must be questioned. In the richest states we have not ‘healthy’ liberal democracies, but rather nascent illiberal nation-states.

Today, it must be said, Dependency Theory seems most applicable to small postcolonial states, such as Haiti, Madagascar and Papua New Guinea. But the list of rich small post-colonial states is quite long now. In fact, most small states are rich, especially measured by GDP per capita (e.g. Qatar, Singapore, Ireland, Iceland, Malta, etc.). Dependency Theory does not seem to be able to explain this, if only to point out that these riches go to local elites. But if one looks at the GINI coefficient, which measures inequality, one notices that 1) inequality is in the rise in so-called ‘core’ states (e.g. the United States the United Kingdom); and 2) although most poor states do have high inequality, several small postcolonial states are quite equal (e.g. Iceland, Moldova, Malta, Montenegro).

Finally, Dependency Theory argues that it is the global economy, and especially free trade, that renders poor states poor, but with the rise of trade wars between the largest markets, it is likely that poor states will only get poorer – it is well-known that small states are especially exposed to market volatility. And if one wonders whether autarchy might be the solution for small states, then one should study the case of Albania.

Overall, greater openness has had “a positive net payoff for growth”.

If war is politics, but with different means, why can small states not conduct hybrid warfare? Take the so-called Nordic and Baltic states. For now, nationalist/illiberal/populist parties do not hold much power in these states (n.b. Norway might be the exception). This means that they all have an interest in seeing Russia not become poorer and weaker, but rather more likeminded. These states (i.e. the states’ leaders and many of their citizens) would approve of Russia becoming more liberal and less belligerent. An ideal Russia would be a pro-free trade Russia, a Russia that give rights to minorities of all sorts, a Russia that prefers cooperation and dialogue over conflict, and a Russia that could offer an alternative to the United States, should it continue down its path towards illiberalism, if not authoritarianism. In short, the Nordic and Baltic states could take shelter under a liberal democratic Russia. Or as Joschka Fischer put it, “a Europe without its North Atlantic backstop has no choice but to turn toward Eurasia”.
Would not some sort of whole-of-government, hybrid approach be an effective way to influence Russian politics? In other words, since President Vladimir Putin is already accusing ‘the West’ of interference, ingerence and regime change, would it not make sense to actually engage in such practices? Moreover, since most of these states are EU MS, would it not make sense to cooperate with EU institutions and agencies in some of these practices?
Beyond the reference to a whole-of-government approach, the second characteristic of hybrid warfare is the targeting of local populations. In other words, hybrid warfare aims to wine ‘hearts and minds’ with ‘mixed methods’. This means that the first tactic in this war to convert Russians must be found in the realm of communication, propaganda and psychological operations. Here, the Baltic states but other Eastern Europeans have the necessary resource: Russophones. From Helsinki to Sofia, investigative journalists, public relations firms and advertising agencies could be employed to tailor messages that resonate with Russia’s various communities – there might even be some jobs for all those unemployed anthropologists and linguists. The tricky ethical question would be whether to engage in ‘fake news’ and fictious online profiles. If the existence of these small states is in question, then the answer for them is relatively simple: all is fair in war.
Economically, trade liberalisation might make more sense than sanctions. In line with the cultural war that took place during the Cold War, these states should use their best weapon: soft power. Of course, diplomats and politicians can make speeches and send artists into Russia, but the private sector would be a far more effective actor. In addition to spreading liberal values via Voice of America and Radio Free Europe, private US media companies could produce goods destined for Russian consumers. But maybe the Nordic states would have the best resource: these states are known as “norm entrepreneurs” (Ingebritsen 2002). Their national brands are recognised and respected – the trick would be to get these brands ‘respected’ in Russia. One idea would be to sell Nordic goods and services in Russia. Simple things, from Ikea kits to luxury furniture could open the way to more exhaustive trade relations, selling all types of things to all types of budgets. Most importantly, what would be hiding in these trojan horses is not the value of capitalism and free trade, as was the case during the Cold War, but other liberal values, such as worker’s rights, environmental standards, gender equality, fair trade, etc. Later, these private sector initiatives could be coupled with free trade agreements that have strict regulations on these matters (cf. the work of Alina V. Vladimirova on the normative power of trade agreements).
The final ingredient in this small state hybrid warfare would be covert operations, focusing on causing division within Russia, not just between liberal and illiberals, but also between communities, regions, and between Russia and its neighbouring states. Politicians could be corrupted, factories could be sabotaged, marches turned violent, etc. The question here, once again, would be how far the small states are prepared to go, i.e. how much the means justify the ends.

In general, small states are not the ideal locations for independent journalism, i.e. the type of journalism that holds the powerful accountable. This is because small states have small markets. And when these states have several popular languages, then the markets are even smaller. This makes the production of quality journalism inefficient. Consequently, “national sovereignty in broadcasting is vulnerable due to the overspill of foreign television channels via satellite and highly developed cable networks” (Burgelman and Pauwels, 1992: 173; Puppis 2009). This is especially true in small states with neighbour that use the same language(s). In Luxembourg, for example, 85.6 percent of the market is owned by foreign television channels (Puppis 2009). The presence of foreign media can affect the politics of small states. In Luxembourg, whether citizens are watching French or German television can affect what they think about certain foreign policy issues, such as war and trade.
This said, the vulnerability of small states and their press is often exaggerated. For one, although the presence of foreign media might on occasion reduce patriotism and national solidarity (in the Baltic states, for instance), this is not always the case. The citizens of Malta or Luxembourg who watch BBC or France 24 are far from irredentist. If anything, the thing threatened by foreign media is not national solidarity, but the national language.
Some have argued that “export does not offer a solution either because media productions from small countries are too culturally specific” (Burgelman and Pauwels, 1992: 173; Puppis 2009). But the case of the state-funded Al Jazeera seems to contradict this claim. The Qatari company produces television and Internet news in several languages, and has become a serious competitor for the likes of BBC and CNN. Al Jazeera has been so successful that other, larger states have followed, producing media outlets such as France 24 and RT. Overall, this confirms the adage that “media markets are language markets” (Puppis 2009).
Small states have also been known to have many free newspaper, which are quite popular. “In 2010, Iceland and Luxemburg were the only European countries where the penetration of free newspapers was higher than that of their paid for counterparts” (Jóhannsdóttir and Ólafsson 2018). And the free papers have been general purpose papers with serious coverage of domestic and international news, not down-market tabloids, and delivered to people’s homes.
Thus, it is not foreign influence or economic viability that are the largest problems for the press in small states. The real issue, perhaps more so than in large states, is the ability of small state journalists to cover the powerful within the state in an objective or critical manner. As is the case for regional and local journalists, conflicts of interest are rife. The same can be said concerning the difficulty of obtaining specialised knowledge. Furthermore, due to short career ladders, most skilled journalists seek better jobs elsewhere.

For small states, it's all about priorities. Even relatively wealthy states simply do not have enough staff to cover all the functions and sectors that larger states cover. So, they must prioritise, prioritise and leverage. In fact, prioritisation and leverage often go hand in hand, especially in foreign affairs. States like Iceland and Luxembourg have become experts at becoming experts. Like small companies, small NGOs and small universities, small states invest in niche areas. This creates a competitive advantage, which can then be exchanged for favours from other states and international organisations. Hence the dual strategy of prioritisation and leveraging, of specialisation and cooperation.
Prioritisation can take many forms. Small foreign affairs ministries tend to only have 20 to 30 missions (including embassies), covering both national representation and representation in international organisations. Moreover, one mission is often responsible for several states and organisations. Of course, large states and ministries also prioritise. Attachés in US embassies, for example, are often responsible for several states. An FBI attaché in London, for instance, will also cover cooperation with Ireland, and the one in The Hague will also cover Luxembourg. This said, small states do this not at the staff level, but at the embassy level. If the Government of the US does not have an embassy in a state, it is usually for political, not technical or economic reasons.
Noteworthy here is the fact that small states can only do so much in terms of cooperation. They cannot be in every meeting and they can not participate in every project. This means not only that they must choose where participation matters the most, but also means that these small states often depend on other states to keep them informed about on-goings.
Prioritisation can also be done as specialisation. Ministries in Luxembourg and Iceland tend to focus on their strengths, hoping to bring actual added-value to other states and international organisations. Thus, the Government of Iceland has acquired knowledge and knowhow in fishing, geothermal energy, soil restoration, and gender issues. This expertise can be used within projects and missions organised by the United Nations (UN), the Council of Europe (COE), the Nordic Council, the Artic Council, etc. Similarly, the Government of Iceland was able to manage the airport in Kabul during the recent NATO mission in Afghanistan (International Security Assistance Force (ISAF)). Likewise, Luxembourg’s Army has specialised in water sanitisation and demining, which enables it, despite its relatively small size, to be of use during UN, NATO and European Union (EU) missions and projects. This said, because the army only sends one or two soldiers on each mission, they must always be integrated within another state’s forces (e.g. Belgian troops).
By creating and fostering such expertise and added-value, these small states can use these capabilities as gestures of appreciation for the benefits they accrue as members of the UN, NATO, the EU, the COE, etc. In other words, specialisation not only allows small states to have an impact, but also allows them to improve their ‘brand’ and not be accused of free riding. Providing symbolic help is a way of consolidating and reinforcing partnerships and relations that are vital to the security and prosperity of these small states.

In the small field that is small states studies, apparently only a small number study rich small states, “for example, the small states of the EU” (Randma-Liiv and Sarapuu 2019, p.11). “Within Europe, there are 12 states with a population between 100,000 and 3 million: Albania, Cyprus, Estonia, Iceland, Kosovo, Latvia, Lithuania, Luxembourg, Macedonia, Malta, Montenegro and Slovenia.” By studying a state such as Luxembourg, for example, many discoveries can be made. Or as Veenendaal and Corbett (2015, p.530) put it, “by studying the systems of understudied nations, instead of those that we already know much about, we are likely to learn much more”.
Unsurprisingly much of what we known is confirmed by the study of Luxembourg. Foremost is the fact that the government of Luxembourg has a shortage of human resources. This is especially evident when one studies the state’s international cooperation. Luxembourg’s embassies, for example, have no military or law enforcement attachés. Instead, the focus is on economic cooperation.
Thus, the generalisation that small states are under “a strong pressure to prioritize” is also confirmed (Randma-Liiv and Sarapuu 2019, p.5). Luxembourg’s armed forces focus on niche specialisations, such as demining and water purification. Or more related to the point just made, the government of Luxembourg tends to pay more attention to economic policy than security policy. Under Jean-Claude Junker resulted in the state’s intelligence agency not being managed by the Prime Minister, which enabled the agency’s executives to conduct illegal operations, including wiretapping and the misuse of public funds for personal business projects.
This said, the third finding that can be confirmed is that small states, despite their prioritisations, have few specialised staff. In fact, this finding seems to apply to all relatively small states – as much as the government of Luxembourg cannot cooperate in all matters with the government of France, the government of France cannot cooperate in all matters with the US government. In interviews with diplomats and military, law enforcement and intelligence liaisons, this is a topic that is constantly mentioned as a limit to security cooperation. When it comes to cooperation with large organisations, smaller states simply cannot cope. They are overnumbered. They are saturated. Ironically, this means that the smaller states, i.e. those with insufficient specialists and insufficient staff in general, must prioritize. They have to decide in which matters cooperation matters (the most).
Finally, the study of Luxembourg confirms the difficulties small states officials face when it comes to the provision of education, and especially specialised professional training. As in many small states, “the limited number of professionals in the civil service makes it economically inefficient and academically impractical to provide specialist education” (Randma-Liiv and Sarapuu 2019, p.7). In security matters, for example, this is seen again and again. Luxembourg’s soldiers have basic training ‘at home’, but their officers (and the state’s three pilots) have go to neighbouring states (France, Belgium, Germany, NATO centres of excellence, etc.) to continue their professional military education. The situation of Luxembourgish detectives and scientific police is even more dire – they are all trained in either France or Belgium. And the situation of Luxembourg’s intelligence officers (i.e. spies) borders on the ridiculous: they are all trained abroad, meaning their ‘cover’ and ‘legend’ are ‘blown’ before they are even created.
All this said, there is one finding that the case of Luxembourg seems to contradict (i.e. falsify). According to Randma-Liiv and Sarapuu (2019, p.6), “all states have their inherent functions which are directly linked to the state’s fundamental interests and where ‘delegating out’ is not viable (e.g. foreign policy, security issues, national culture, court system)”. But in addition to professional training, it is evident that, as in Iceland, many core military and intelligence functions are provided by allies.

When I tell people that (one of the states) I study is Luxembourg, they are often surprised. True, this is in part because I have no personal connection to Luxembourg – political scientists and International Relations (IR) scholars tend to study states where they live or have lived. But the other reason for such case selection questioning is found in Luxembourg’s relative size and significance. Many laymen and academics think only the largest and most significant states ought to be studied. I imagine this is because people tend to want research to be useful, by being policy oriented for example. Concerning the study of security cooperation, for example, these individuals would argue that the states to be studied are those that are most involved in security cooperation or those that affect security cooperation the most. Of course, not all social scientists avoid studying smaller states. And of these, not all only study small states because they live or have lived in small states. Many scholars study small states because of the subject matter’s use to science (Veenendaal and Corbett, 2015). Or as Thorhallsson and Steinsson (2017) put it, studies of small states have “the potential for enormous intellectual payoffs for international relations and foreign policy analysis“.
Studying small states can provide inspiration, ideas and even insights, and this for two reasons. The first is the simple fact that, without comparative and relational studies, one cannot know that which states are large or significant. But the second, less appreciated fact is that studying small states is a complexity reducing exercise. By studying small states, one studies large states writ small. One studies a microcosm.  Pace  Thorhallsson (2018) and Randma-Liiv and Sarapuu, 2019, small states are not fundamentally different from larger states: they have administrations, they have territory, and these administration – and only these administrations – have the legitimacy to regulate violence within these territories. In other words, scale-related problems are one of degree, not kind. In view of this fact, it is clear that studying small states and comparing them with large states ought to provide great knowledge. Just as economists use thought experiments where the number of goods is limited, IR scholars can study (real) states where the population, territory, economy, and public administration/military is limited.
The study of small states is so insightful that when one does try to study small states, one often ends up learning more about medium size states! One discovers, for example, how vulnerable and weak medium sized states are. Statements such as “a free hand might come to mean an empty and unarmed hand” (Liska, 1968), and “the price of alignment is the loss of real independence and effective sovereignty” (Keohane, 1969) apply just as much to France as they do to Luxembourg.
Similarly, one also discovers important insights about international relations: “"informal penetration" is a pervasive phenomenon in contemporary international politics which works in both directions: Small states can penetrate large ones as well as vice versa” (Keohane, 1969). Here, of course, we need to stop thinking about states like hermitic entities, sealed off from one another. Instead, we should be viewing social relations as a “totality” (Bailes, Thayer and Thorhallsson, 2016). Like cartels, states communicate and coordinate; they share employees, capital, equipment, and know how, they merge and divide.
Reversely, the study of small states can lead one to conclude that a small state is not that small, i.e. that some small states are smaller than others. The Netherlands is not Luxembourg, which is not Lichtenstein, which is not the Holy See. So, when one studies a small state, one in fact might not be studying a small state at all, but rather a not-so-small state. This is the argument of many small state scholars. These scholars seek to demonstrate not only the vulnerabilities of small states, but also their resources, capacities, capabilities, competencies, and influence (e.g. Keohane 1971). Fewer diplomats and experts, for example, means less presence and skill in negotiations, but also more flexibility, better delegation, and more informality, which in turn means faster decision-making. Just like start-ups and boutique enterprises, small states can be more agile and nimble than larger states, Davids to Goliaths Thorhallsson (2018).