The word "state" can also refer to the political subdivisions of some countries, such as Australia, India, Nigeria and the United States. These definitions are related in that in the case of Australia and the United States, the state governments existed before the federal governments and are seen as possessing some powers which are independent of the federal government.
In casual language, the idea of a "state" and a "country" are usually regarded as synonymous, although some speakers, notably in the United States, make efforts to use "country" or "nation" for the sovereign entities. Others would primarily understand "the State" as a synonym for "the Government", or be careful to distinguish between a territorial "country" and a "nation" of people.
The legal criteria for statehood are generally accepted to be those set out in Article 1 of the Montevideo Convention. "The state as a person of international law should possess the following qualifications: (a) a permanent population; (b) a defined territory; (c) government; and (d) capacity to enter into relations with the other states." (The Montevideo is a regional American convention; but the principles contained in this article have been generally recognized as an accurate statement of customary international law.) However, some have questioned whether these criteria are sufficient.
A major issue is the difference between the constitutive and declarative theories of recognition of states. According to the constitutive theory, a state exists only insofar as it is recognized by other states. The declarative theory, by contrast, holds that the existence of a state is independent of its recognition by other states. Which theory is correct is a controversial issue in international law. An example in practice was the collapse of central government in Somalia in the early 1990s: the Montevideo convention would imply that the state of Somalia no longer existed, and the subsequently declared republic of Somaliland (comprising part of the so-called "former" Somalia) may meet the criteria for statehood. However the self-declared republic has not achieved recognition by other states.
A further controversy, within political philosophy, centers on the question of when the state came into being, and what its basic characteristics are. One of the most basic characteristics of a state is regulation of property rights, investment, trade and the commodity markets (in food, fuel, etc.) typically using its own currency. Although states increasingly cede these powers to trade bloc entities, e.g. North American Free Trade Agreement, European Union, it is always controversial to do so, and opens the question of whether these blocs are in fact simply larger states. The study of political economy which evolved into the modern study of economics studies these specific questions in more detail.
A problem is that states are often to some extent dependent of dominant and more powerful states, and/or by their free will subject to higher political subdivisions, as for instance the United Nations, the European Union, the World Trade Organization or other international organizations. However, although states often are in practice subject in this way, they are much stronger in relation to international organizations or other states than lower (substate) political subdivisions normally are in relation to states. But the trend at the moment is for the power of superstate levels of governance to increase, and there is no sign of this increase abating. Many (especially those who favour constitutional theories of international law) therefore reject as outdated the idea of sovereignty, and view the state as just the chief political subdivision of the planet.