Session Recap: Institutional, Political, and Cultural Changes and Their Impact on Public Management and Fiscal Policy at the State and Local Level
November 8, 2014 05:00 PM
By Bijetri Bose, University of Washington
Chair: Jonathan West, University of Miami
Discussant: Doug Goodman, University of Texas at Dallas
The Role of Management Change and Political Climate in Improving Local Fiscal Health by Jennifer M. Connolly, University of Miami
Does Trust Mediate the Relationship Between Relational Community Attachment and Willingness to Pay for Public Services? by Kenneth A. Kriz, University of Nebraska, Omaha; Arwiphawee Srithongrungand Mark A. Glaser, Wichita State University
The Impact of Economic, Fiscal, and Political Factors on State Debt Disclosure by Bo Zhao, Federal Reserve Bank of Boston, and Wen Wang, Indiana University-Purdue University Indianapolis
This session revolved around the issues of institutional, political, and cultural changes and their impact on public management and fiscal policy at the state and local level. The three papers in this session make important contributions to the literature in terms of transparency, ethical, and decision making issues. The discussant, Doug Goodman, stated that the papers also bring to mind several questions that should be addressed by further research.
Connolly examined the effect of turnover of city managers on local financial outcomes. Existing literature has mixed theoretical and empirical evidence of the effects of city manager changes, with a common belief that frequent changes in managers is costly and harmful. Looking at municipal data from California, Connolly found support for the positive impact of turnover of city managers on the severity and frequency of deficits. This study has important implications from the human resource perspective.
Does trust play a mediator role in the relationship between community attachment and the willingness to pay for public services? This question was answered by Kriz in his presentation, using structural equation modeling (SEM) that relies on confirmatory factor analysis that assesses whether the constructs purportedly measured using previous indices have in fact been measuring the latencies that they were supposed to measure.
Wang presented a methodologically sound paper on transparency in public debt disclosure. Wang and his co-author, Zhao, examined how economic, fiscal, and political factors affect the gap between debt disclosures in the Comprehensive Annual Financial Reports (CAFR) and the Census. Preliminary results show that the gap increases with unemployment rate, the unexpected state budget deficit, and when a state government is under one political party’s control. The authors suggest that the Governmental Accounting Standards Board may consider strengthening their rule in state debt disclosure in CAFR and broadening the debt measure toward the one used by the Census Bureau.