Social Policies in Small States

Small states, particularly islands, are convenient and manageable ‘laboratories’ where theories could be tested and processes observed within a semi-closed system. This interest in the “Lilliputians” is particularly manifested among geographers, anthropologists, ecologists and biologists. For economists and political scientists, small states can provide insightful examples of how internal dynamics and external pressures interplay in social and economic policy making. This research intends to examine how small states have dealt with development challenges and opportunities within their national, often enisled, context. It would critically evaluate the economic history of these countries within a specific ‘political economy’ framework, by investigating how their social policies contributed to different social, economic and political outcomes.

Small, often island states frequently make news headlines when they are sites of economic or political instabilities: the ‘failed state’ of the Solomon Islands, the imminent collapse of Nauru, the crisis of East Timor, ethnic tensions and coups in Fiji are but recent examples. Small jurisdictions are also sometimes accused of being modern day pirates, bent on distorting international financial rules or operating on the margins of the financial system by creating offshore financial centers and attracting “unscrupulous” sources of funds. There are however, many other small developing states that have made a successful transition to modernity, with quite envious standards of living and a decent quality of life. Although there has been some scattered research on the general issues of small states (mainly as a result of conferences and the sustained scholarship of the Commonwealth Secretariat), no systematic global attempt has yet been made to understand how some small states (like Iceland, Malta, Barbados and Mauritius) have (so far) managed to avoid the inevitable catastrophe that their small size forecasted in principle. There is hardly any comparative research on small states as a group of countries aimed at understanding social policy issues and the linkage between these and their economic development.

This research will investigate why some small economies have succeeded in formulating ingenious social development policies to overcome their chronic vulnerabilities and have managed to improve their social indicators. It will also investigate why other small countries, with similar or different policies, have not succeeded in increasing the welfare of their population. This research will investigate the reasons behind such policy performance looking into different hypotheses that explain such good or bad performance. Specifically, we will look at consensual democracy (‘social pacts’ or societal corporatism), welfare state, power of jurisdictional resourcefulness, and levels of social cohesion/capital. The approach of this research would be to explain why and how things evolved historically from a comparative and analytical perspective. This approach will combine both qualitative and quantitative analyses.

This research project has the merit of being both academic and at the same time relevant for policy making. The aim of this research will also be to contribute towards the empirical literature on small states. In addition, by investigating social policies in small states from a comparative perspective, the findings will help unmask the complexities in designing social policies within different socio-economic, institutional and historical settings. Studying countries (both that have succeeded in achieving better social outcome and those that are still lagging behind) will provide lessons for others to consider.

This project is a joint collaboration between UNRISD and the Commonwealth Secretariat.