The political development literature explores the historical origins of modern political institutions. It views political development as a continuous construction and reconstruction of state power. The focus of the literature is on the interaction of different layers of government and how the incorporation of institutions created at different times and for different purposes, shaped in part by external pressures, impact the nature and exercise of political authority. This panel explores the contributions of the political development literature for understanding the development of the European Union and the relationship between national and European political institutions.  Papers explore the relationship between the welfare state and European market regulation (Daniel Wincott), the evolution of EU’s foreign policy authority (Anand Menon), the origins and development of EU’s power to regulate foreign direct investment (Sophie Meunier); the role of currency cooperation in shaping European integration, and how financial market cooperation has impacted the distribution of regulatory authority between national and supranational institutions (Mark Dingfield and Orfeo Fioretos).