Governmental Financial Condition and Contingency Factors: Pseudo open model for performance in the organizational management of local governments
DOI:
https://doi.org/10.14392/asaa.2025180208Keywords:
Contingency factors, governmental financial condition, local governmentsAbstract
Objective: This study aims to analyze the relationship among contingency factors and the financial condition of local governments.
Method: A pseudo-open model proposal of governmental financial condition was developed, encompassing financial and socio-environmental aspects with regard to contingency factors. Financial condition was assessed using the model of Wang et al. (2007), with the adaptation by Arnett (2014). The variables of the contingency factors were divided into two dimensions, following the criteria of Woods (2009), namely: (i) External factors, represented by the Environment; and (ii) Internal factors, including Technology, Structure, Size, and Strategy. The research covered the 223 municipalities of the state of Paraíba from 2017 to 2020, except for the municipality of São Vicente do Seridó, which could not be included in the 2017 analysis due to lack of available data. Thus, the final sample consisted of 891 observations.
Results: The results indicate that municipalities with larger population size show better financial condition, while higher personnel expenditures are negatively associated with performance. In addition, the use of information technology, measured by IGOVTI, revealed a negative and significant effect, suggesting possible challenges in integrating technology into management.
Contributions: The findings provide support for the financial management of local governments, highlighting the importance of efficient personnel administration and a critical assessment of technological investments in order to promote the sustainability of financial condition.
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