Institutional Conversion and Digital Transformation in Local Governments: A Longitudinal Analysis of Trajectories

Abstract

This article asks a central question in digital government research: why do local governments operating under similar institutional conditions follow sharply different digital transformation trajectories over time? Drawing on theories of gradual institutional change, the study conceptualizes digital transformation not as a discrete adoption outcome, but as a process of institutional conversion through which technological capacity is translated into sustained digital service provision. Information governance is theorized as the key conditioning mechanism linking technological resources to durable organizational outcomes. The analysis combines longitudinal panel models, fixed-effects estimators, and trajectory-based clustering using a panel of all Brazilian municipalities (MUNIC/IBGE; N = 5,569) across seven waves between 2004 and 2024. Results show that increases in technological capacity are associated with subsequent gains in digital services, but these effects are gradual and conditional. Information governance significantly shapes how municipalities mobilize and stabilize technological resources over time, while interaction models reveal non-linear and diminishing returns consistent with institutional coordination limits. Trajectory analyses identify four distinct patterns of digital transformation, ranging from ‘institutionalized pioneers’ to ‘persistent stagnation’, demonstrating that digital development unfolds through path-dependent and institutionally anchored trajectories rather than through simple convergence. The article contributes to public administration research in three ways: provides rare longitudinal evidence on local digital transformation over two decades; integrates institutional change theory into digital government research by conceptualizing governance as a mechanism of institutional conversion; and advances a trajectory-based explanation of digital transformation that shifts attention from episodic technological adoption to cumulative institutional processes shaping long-run administrative performance.