What explains the incremental reforms in European financial regulatory reforms after the 2008 financial crisis despite the unequalled opportunity for radical policy change? This article tests two alternative accounts of the observed policy outcome in European financial regulation. The first account focuses on historical institutionalist mechanisms such as path dependence, policy feedback loops, and mobilized constituencies. The second explanation draws on rational choice institutionalism and emphasizes preference convergence in pursuit of collective action at the supranational level. The empirical analysis shows that the incremental policy outcome is consistent with a rational choice institutionalist account of policy-making, which is a novel application of incrementalism in the literature.
