Ausgleich

The Ausgleich was an agreement in 1867 that created the dual Austro-Hungarian Empire, establishing Austria and Hungary as separate entities with their own governments, armies, and laws, but united under a single monarch. This arrangement allowed both regions to have a degree of independence while sharing certain common institutions, like finance and foreign policy. It was a compromise to balance the different national interests within the empire, helping to maintain stability and prevent conflict between the diverse populations.