Local government transparency index: determinants of municipalities’ rankings

Date09 May 2016
Pages327-347
DOIhttps://doi.org/10.1108/IJPSM-11-2015-0199
Published date09 May 2016
AuthorJoaquim Filipe Ferraz Esteves de Araujo,Francisca Tejedo-Romero
Subject MatterPublic policy & environmental management,Politics,Public adminstration & management
Local government transparency
index: determinants of
municipalitiesrankings
Joaquim Filipe Ferraz Esteves de Araujo
International Relations and Public Administration Department,
University of Minho, Braga, Portugal, and
Francisca Tejedo-Romero
Department of Business Administration,
University of Castilla-La Mancha, Albacete, Spain
Abstract
Purpose Cases of corruption, embezzlement, theft and fraud, abuse of discretion, favoritism,
nepotism, clientelism, and abuse of power in governments have led to a growing demand from
society to access pub lic information. In respons e to this demand, governments h ave been forced to be
more transparent i nt he conduct of their activities. Th e information transparency inde x (TI) may be
conditioned by eco nomic and political character istics of local governments af fecting the information
provided. What factors influenced the index of municipal transparency? Literature about
transparency is lar gely based on the expla nations of the agency t heory and the legiti macy theory.
Based on the postulat es of both theories, the purpose of th is paper is twofold. First, study the i ndex
transparency in Sp anish municipalities, and, secon d, determine the main features that ar e affecting
the index of transparency.
Design/methodology/approach Data were collected from Transparency International Spain
ranking and from official sources. Univariate and multivariate analysis are performed for the treatment
of data.
Findings The results shows that political factors like electoral turnout, political ideology, and
political competition have a significant effect on the index of transparency. Gender has no significant
effect on the index of transparency.
Originality/value This study is a contribution to the growing body literature of transparency in
order to understand what explains the variations of the TI among municipalities.
Keywords Local government, Municipalities, Transparency, Transparency index
Paper type Research paper
Introduction
Changes introduced in the last few decades in the public sector altered the public
administrations traditional culture, opening organizations and increasing the
mechanisms of accountability and transparency. Transparency is a mechanism used
to improve good governance in public services (Piotrowski, 2007; Bauhr and Grimes,
2014) and increase the publics ability to access government information (Roberts,
2006a; Piotrowski and Van Ryzin, 2007). It is about increasing the effectiveness of its
management, looking for ethical standards and government decisions (Cooper and
Yoder, 2002). Focussing on the relationship between information disclosure (supply
side of transparency) and the access and usability of information by citizens and
stakeholders (demand side of transparency), it allows a better understanding of public
policies and increases the publics trust (Park and Blenkinsopp, 2011). In addition, it
holds officials accountable for their actions and outcomes, based on the accessibility
and divulgence of information. Public administration transparency has increase d
International Journal of Public
Sector Management
Vol. 29 No. 4, 2016
pp. 327-347
©Emerald Group Publis hing Limited
0951-3558
DOI 10.1108/IJPSM-11-2015-0199
Received 3 December 2015
Revised 30 January 2016
29 February 2016
Accepted 20 March 2016
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0951-3558.htm
327
Local
government
transparency
index
worldwide since the 1990s (United States Agency for International Development, 2011),
and several international organizations have recommended governments to adopt
socially responsible practices and to provide information about their activities
(Organisation for Economic Cooperation and Development, 2006).
Most of the literature about transparency focusseson central government. Concerning
municipal transparency, it would be beneficial to develop our understanding of it
(Piotrowskiand Bertelli, 2010; Greco et al., 2012). Efficientuse of scarce resources requires
a more effective use of mechanisms of transparency in municipalitiesdecision-making
process. Researchers demonstrate the importance of some factors to explain the level of
transparency in municipalities (Piotrowski and Van Ryzin, 2007; Alt et al.,2006;
Albalate del Sol, 2013; Alcaraz-Quiles et al., 2015). In Spanish municipalities, it is helpful
to analyze the information of the transparency index (TI), and identify the main factors
that are affecting the index of transparency. The choice to carry out our analysis in
municipalities is due to problems with transparency, which are more frequent at local
level (Guillamón et al., 2011; Cuadrado-Ballesteros, 2014). Besides, the social pressure
exerted by some citizensmovements, such as los indignados (Barreiro and Sanchez-
Cuenca, 2012), and the influence of the crisis on Spanish municipalities compel the
reduction of public debt through greater supervision of public deficit with new local
financial regulations and legal control(López et al., 2013). In this sense, the municipalities
are under pressure to increase management efficiency and be more transparent with
public resources management.
According to the literature, the exposure or withholding of information is inherently
political and can be influenced by citizens and political factors. This paper contribute s
to this debate by empirically assessing local government transparency by
incorporating in the analysis political explanatories factors. It also addresses the
problem that results from the literature of probable endogeneity, created by the
causality relationship between transparency and political variables (Su et al., 2011;
Arnold and Freier, 2015). We will explore, from the supply side of transparency, how
political factors influenced the level of the TI constructed by Transp arency
International Spain (TI-Spain). The analysis is based on the scarce literature on
transparency, which mainly focusses on the area of budget and fiscal transparency at
central level. The interest in Spanish cases emerged because this is one of the few
countries which did not have, at the time of this study, a transparency law in force.
Further, it would be worthy to analyze if the social movements influenced the level of
municipal transparency. We expect that social movements and the pressure from
citizens had a positive influence on the level of municipal transparency. The TI
constructed by TI-Spain, which focusses on other areas beside budget and fiscal
transparency, opens opportunities to test the hypotheses on transparency.
The paper begins by looking into the index of transparency in Span ish
municipalities, and then examines Spanish municipalities to analyze the factors
determining the index of transparency. It aims to answer the following research
question:
RQ1. What factors influenced the index of transparency on the Spanish
municipalities until 2012?
We carried out a univariate and multivariate linear regression (OLS) analysis.
Additionally, we used an instrumental variables (IV) regression analysis based on a
two-stage least squares (2SLS) regression design, to control the problem of possible
endogeneity.
328
IJPSM
29,4

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