Risk or Opportunity? Institutional Change and Europe’s Financial Crisis, 2008–12

Abstract

our contribution links mechanisms to particular outcomes, specifying the conditions under which institutional change may occur. On a policy level, evidence shows that institutional innovation was helpful in Ireland: increased bargaining power of the anti-change (pro-stability) coalition and fewer feedback interactions (lower interdependence) led to layering as a mechanism for change. Lower bargaining power of the Greek anti-change coalition and higher interdependence led to institutional displacement, which, under pressure by supranational actors, had disastrous effects.