"This article traces the role of the EU institutions in setting up the European stability mechanism (ESM). There have been many scholarly assessments but few empirical reconstructions of decision‐making on the intergovernmental ESM and its predecessor the European financial stability facility. The instruments clearly constituted a step away from supranational entrepreneurship and the Community method. However, we question the intergovernmentalist interpretation in terms of institutional competition and decline. Using a historical analogy of the Delors model(s), we identify two types of institutional leadership and show how the ESM was characterized, first by an uneasy combination and then a shift from political championship to the engineering type of leadership. Using two case studies, we trace the negotiations for increasing the size and scope of the ESM. The analyses show that this was a bottom‐up process in which the institutions laid out the tracks and provided the link between the control room (European Council) and ‘machine room' (Eurogroup/Eurogroup Working Group/ Task Force on Coordinated Action) proceedings."

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