The creation of EMU entailed stripping member states of some of their economic policy levers and transferring them to transnational bodies. For a 'Westphalian' institution like the IMF, with its strongly country-based governance and modus operandi, the creation of EMU should in theory have posed a major challenge from the start. Yet this paper will show that institutional change in practice took a minimalist, heavily path-dependent direction. Whilst this ''path of least resistance" did not prove problematic in the early years of EMU, the eruption of the sovereign debt crisis and the concomitant role of the Fund in managing it posed more fundamental challenges to the Fund's country-based paradigm. As further policy levers are likely to be transferred the European level in the near future, the European integration project will necessitate more fundamental changes to its policies as well as its representation and membership.
