Do City Managers Improve Government Performance?

Abstract

Why do some local governments perform better than others that are socioeconomically, culturally, and geographically close? This paper examines variation in local government performance across 209 Catalan municipalities with over 5,000 inhabitants. We test whether the municipality’s adminis-trative structure affects local government performance. In particular, we explore the effects of re-placing a traditional public administration structure (i.e., headed by bureaucrats) with a new public management model (i.e., headed by city managers) in two dimensions: first, transparency and ac-countability; and, second, financial performance. Results indicate that, ceteris paribus, municipalities with a city manager are more transparent, responsive and open to citizens, but do not perform better in financial indicators. Financial performance seems to be more driven by political factors: Right-wing governments are associated with higher debt levels but a faster ability to reduce debt; and, conversely, coalition governments are less indebted than single-party governments but are slower in debt reduction.