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Reflecting on the diversity of restructuring paths followed by national economies since the 1970s and the increased importance of the supranational and subnational scales as regulatory apparatuses, this article uses a third-generation regulationist approach to explore the urban dimensions of the restructuring process and current traits of uneven development in Europe. It looks at the local level in Greece and the ways in which inherited scalar hierarchies are being shaken up under EU spatial policy. It focuses on the city of Heraklion and local state efforts to institutionalize development processes in line with EU urban policy. In the light of this, it underscores the path-dependent character of urban restructuring and argues that urban restructuring, as conceptualized by EU urban programmes, faces the problems generally encountered by a prescriptive advocacy of policy. It operates as an external institutional shock that unsettles established patterns of socio-political mediation and interaction, but falls short of triggering the emergence of locally defined development paths.
