50 Years of Crises: the Development of the European Financial Assistance Regime

This dissertation provides a comprehensive historical study of extraordinary financial assistance in the European Economic Community and European Union, a topic with growing relevance in political science. The analysis covers the development of the European financial assistance regime from 1968 until 2023 using a combined historical institutionalist approach. The built theoretical framework for this study is composed of a critical juncture and a legacy analysis and is applied to four typical cases of crisis-induced change in the regime’s development. These four cases are the monetary instability of 1968-1969, the first oil shock of 1973-1974, the international financial crisis starting in 2008 and the Covid-19 crisis starting in 2020. Through the application of the theoretical approach of ‘actor-centred historical institutionalism’, this dissertation explains first, the necessary conditions for the occurrence of punctuated change, and second, the long-term implications of punctuated change in the form of processes of piecemeal adjustment. The findings demonstrate that crisis-induced change is facilitated by exogenous and endogenous factors linked to the financial impact of crisis and the resilience of the ex ante assistance regime, as well as by rationalist considerations of relevant actors reflected in a mix-preference game. In addition, this dissertation argues that crisis-outcomes need to be analysed in subsequent periods to fully grasp their causal force and to uncover legacy mechanisms accounting for continuity and piecemeal adjustment of punctuated changes. Based on the findings presented in the four cases, this dissertation furthers the understanding of crisis-induced integration in financial assistance and provides a detailed explanation of the development of financial assistance instruments since 1971.