`Odysseus and the Lilliputians': Germany, the European Union, and the Smaller European States

Does Germany dominate Europe and the smaller European states? Why does it not? Questions like these have stimulated Peter J. Katzenstein to draw up a balance sheet of united Germany's relations with its European neighbours. By emphasizing the concept of `semi-sovereignty' at the domestic level and `associated sovereignty' at the international one, Katzenstein's book draws attention to institutional aspects which affect German policy. Soft and indirect power, rather than direct influence, have been a predominant feature in Germany's policies towards Europe. The present review essay presents the major findings of this important book and makes three critical comments (all from an institutional perspective). It suggests, first, that the concept of semi-sovereignty is biased towards the constraining effects of institutions rather than towards their constitutive importance; second, that the concept of institutional embeddedness underestimates the importance of institutionalization; and finally, that the book leaves the issue of small-state behaviour underexplored. In conclusion, this review essay looks ahead and hints at the increasing divide between the smaller and the larger states in the EU. Germany's dilemma in this respect is to make multilateralism effective, yet to avoid the impression that its reform proposals are an effort to institutionalize German hegemony.