The COVID-19 pandemic and institutional change in the EU’s financial assistance regime: the governance of the Recovery and Resilience Facility (RRF)

Abstract

ABSTRACT This article aims at explaining the establishment of the Recovery and Resilience Facility (RRF) around a new governance system of EU financial assistance in response to the COVID-19 pandemic. Through a process tracing analysis and semi-structured elite interviews, the paper shows that between the pandemic outbreak and the adoption of the RRF, an ‘ideational change’ occurred about the financial assistance regime in the EU. Such an ideational change consists in two concomitant phases – a first phase of ‘ideational collapse’ of the existing governance mode (i.e. intergovernmental coordination as per the ESM) and a subsequent phase of ‘ideational consolidation’ around a new governance mechanism (i.e. limited supranational delegation as exemplified by the RRF). Based on the specific case study of the RRF, the paper discusses implications for how institutional change in the EU may take place following an exogenous shock and the relative explanatory power of ideas in determining the final form of institutional change.