Are small states susceptible to groupthink? Lessons for institutional design

Abstract:

This article critically assesses the claim that smaller states may be structurally and socially pre-disposed towards more effective government performance.

A review of recent experience in Iceland and Ireland indicates that the domestic characteristics that have been argued to foster superior small state performance can, under certain conditions of size and homogeneity, contribute to government failures.

Furthermore, experience in these states suggests that high levels of social cohesion and homogeneity may increase the risk of a specific social phenomenon (‘Volkthink’) with adverse consequences for public policy.