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Austria-Hungary was a multinational realm and one of the world's great powers at the time. Austria-Hungary was geographically the fourth largest country in Europe after the Russian Empire, the German Empire and Scandinavia (621,538 sq km), and the third most populous (after Russia and the German Empire). The Empire built up the fourth largest machine building industry of the world (after the United States, the German Empire and the United Kingdom).
The constitution of the Austro-Hungarian monarchy was based on: (1) the Pragmatic Sanction of Emperor Charles VI, first promulgated on April 19, 1713, whereby the succession to the throne is settled in the dynasty of Habsburg-Lorraine, descending by right of primogeniture and lineal succession to male heirs, and, in case of their extinction, to the female line, and whereby the indissolubility and indivisibility of the monarchy are determined; (2) the diploma of Emperor Francis Joseph I of October 20, 1860, whereby the constitutional form of government is introduced; and (3) the Ausgleich or the Compromise of 1867 that concluded on February 8, 1867, where Austria and Hungary were recognized co-equal.
The two separate states, Austria and Hungary, were completely independent of each other, and maintained separate parliaments each with its own prime minister. The unity of the monarchy was expressed in the common head of the state, who bears the title Emperor of Austria and Apostolic King of Hungary, and in the common administration of a series of affairs, including the foreign affairs, military and joint financial policy.