Historical reason: Amsterdam is a city where trade has always been more important than ideology or religion – overly strong views would only hamper relations. Too, Amsterdam is traditionally a city of immigrants. Jews from Spain and French protestants found a safe haven, centuries ago. When it comes to prostitution or the use of drugs the Dutch feel that if it’s going to happen anyway it is better to legalize and control it than to let it fester underground. [More about Amsterdam’s tolerance]