Impact of demographic, political and financial factors on municipal transparency: a dynamic panel approach

Abstract

Purpose - This paper seeks to identify some of the most important drivers of Portuguese local government transparency in their activities over time. Recent literature on good governance has repeatedly identified transparency as central to promoting accountability, preventing corruption and mismanagement, and stimulating greater civic engagement. As local government is the main provider of many primary services to the population, evaluating its transparency is especially relevant given that misconduct or maladministration will have a strong impact on the population’s well-being. Given increased diffusion of European good governance norms and practices, we believe the Portuguese case to be relevant across the EU. Design/methodology/approach - We develop a dynamic panel data model to evaluate the simultaneous influence of both political and contextual variables on the Municipal Transparency Index (MTI) in 308 Portuguese municipalities during the period from 2013 to 2017. Findings - The results suggest support for previous studies that found increased internet enabled transparency in municipalities with low levels of indebtedness (per capita), are more highly populated, are governed by left-wing parties, demonstrating higher levels of financial efficiency. The urban/rural status, measured by population density, is not a significant predictor. Originality/value - The paper seeks to confirm earlier analyses of these same data over a a longer period of years to substantiate the validity of those findings. This is important especially in the context of the political variable, to demonstrate it was not necessarily a particular collection of left-wing mayors, but that the relationship holds over time, across administrations, because the dataset covers two election periods.