After the stagnation that beset the European Communities in the 1970s, European unification has made decisive advances between the mid-1980s and the Eastern enlargement of the European Union in 2004. At the same time, legal differentiation ("flexibility") has allowed initially reluctant member states to opt out of new obligations in a variety of important areas, including monetary integration, defense policy, and justice and home affairs. This book disentangles the important, fascinating, and complex relationship between flexibility and European unification. Alkuin Koelliker builds upon public goods theory to uncover the logic of differentiated European integration. The result, differentiated integration theory, explains why flexible integration among the most willing EU members eventually attracts reluctant countries in some cases, but not in others-as well as why it is sometimes not even used in the first place. Empirical case studies are drawn from all the main pillars of EU activities, taking into account instances of differentiation within and outside EU law, as well as of differentiated arrangements within and beyond EU borders. Flexibility and European Unification provides the first theory-based, comprehensive, and empirically sound account of European integration from the perspective of legal differentiation.