Austro-Italian ironclad arms race
Austria's defeat in the Seven Weeks War forced Austria to determine a new set of foreign and domestic policies for the future, as Austria's interests since the days of the Holy Roman Empire had primarily been found in Italy and Germany. The Empire thus reformed itself into the Austria-Hungarian Empire following the adoption of the Austro-Hungarian Compromise of 1867 (German: "Ausgleich"), which re-established the sovereignty of the Kingdom of Hungary and placed Hungarians within the Empire on an equal footing with Austrians. Under the "Ausgleich", Emperor Franz Joseph I would be crowned as King of Hungary, while a separate parliament at Pest with powers to enact laws for the lands of the Holy Crown of Hungary would be established.
History of Austria
These acquisitions together with conquests in the Balkans gave Austria its greatest territorial extent to date. 1713 also saw the Pragmatic Sanction, designed to prevent any further division of the territory. But when Charles VI (Archduke 1711–1740) died and was succeeded by his daughter, Maria Theresa (1740–1780) Austria was perceived as weak, leading to the War of Austrian Succession (1740–1748) and the Seven Years' War (1756–1763). Subsequently, Austria lost Silesia to Prussia. Austria also lost prior conquests from the Ottomans except Banat of Temeswar and Syrmia in the Austro-Russian–Turkish War despite being allied with Russia.