The institutional developments in Economic and Monetary Union (EMU) during the sovereign debt crisis were mostly studied with reference to intergovernmentalist theories. However, they can hardly explain the dominant role of the Eurogroup and Eurogroup working group (EWG) compared to the EU-27 formats in the Council, the ECOFIN and the Economic and Financial Committee. This article seeks to address this puzzle. Based on sociological-institutionalist theories, I argue that the distinction between euro area member states (EAMS) and non-EAMS structured how member state representatives organised EMU governance processes during the sovereign debt crisis. The reinforcement of the Eurogroup and EWG is interpreted as an explicit manifestation of this institutionalisation of differentiated integration (DI) in EMU. The empirical findings suggest that the two informal formats were transformed into viable euro area bodies providing the EAMS with the political authority, normative environment and administrative resources to design and implement policies independently. In this reinforced shape, the Eurogroup and EWG enabled a distinction between EU and euro area matters and provided EAMS with suitable instruments to manage their issues. The institutionalisation of DI has long-term implications for EMU reform processes and governance practices.
