Conference Agenda

Italy, like other European countries, is characterized by extreme territorial fragmentation, which poses significant criticalities, particularly, for municipalities, in terms of administrative capacity, financial sustainability, and democracy quality. The nearly 8,000 Italian municipalities represent a testing ground to evaluate how the principle of subsidiarity – enshrined since 2001 in Article 118 of the Constitution, according to which the exercise of administrative functions is located at the government level closest to the citizen, except where unitary exercise is necessary – can be concretely implemented and whether it can be considered a ‘generator’ of value within territories (Deidda Gagliardo, 2002). Local governments often find themselves caught between increasing regulatory complexity, limited or rigidly allocated resources, and the need to innovate service delivery methods to respond more efficiently to the needs of their communities. While their proximity to citizens makes them key for meta-governance (Torfing et al., 2012) and participatory local development (Allegretti, 2010), about 75% lack sufficient scale or resources. Notably, 498 Italian municipalities currently face financial distress (Degni et al., 2024).

Indeed, the 1.309 municipalities experiencing declared financial distress (1989-2023, ~12%) offer a valuable perspective for studying subsidiarity. Analyzing these critical cases can highlight effective policies for multi-level governance.

While focusing on Italy, this issue is also relevant in other European countries (Wang et al., 2008; Navarro-à-Galera et al., 2017; Padovani et al., 2025).

Research Questions

The study is characterized by several preliminary and intermediate research questions aimed at structuring and sequencing a work that ultimately intends to answer a global question: "To what extent can the municipality, particularly the municipality in financial distress, represent a concrete tool for measuring the effective application of the principle of subsidiarity in the multi-level system?"

Connected questions:

• Can the budget be considered an elective instrument for the governance of the high multifactoriality of municipalities as entities with general administrative competence?

• How does the condition of financial distress affect the generation of local value?

• What role does predictive analysis play in preventing value loss in territories?

• What are the optimal conditions – in terms of scale, organizational structure, and financial resilience – for municipalities to act as efficient and democratic public actors?

• Can forms of inter-municipal cooperation offer a valid solution to overcome administrative fragmentation while safeguarding local identity and autonomy?

Research Design: methodologies and theories.

The research adopts a mixed methodological design, given the multidisciplinary approach required by the issues raised.

The theoretical framework is based on relevant contributions in the literature on:

• Principle of subsidiarity (Millon-Delsol, 2003; Massa Pinto, 2003; Colozzi and Donati, 2005)

• Multi-level governance (Hooghe et. al, 2020) and meta-governance (Sørensen & Torfing, 2009)

• Public value (Moore, 1995; Osborne, 2006)

• Financial performance and predictive models (Gregori and Marattin, 2019; Antulov-Fantulin et al., 2021)

The quantitative analysis will consider the main works on the integration of big data and open data at the municipal level, including variables such as population, financial indicators, provision of services, and territorial characteristics, to draw some considerations regarding the importance of data and their processing using advanced statistical techniques.

The qualitative analysis involves the study of a sample of municipalities, particularly those in financial distress: therefore, data, but also stories, because the specificity of each municipality is the main source of value.

The quali-quantitative investigation will be intertwined with – and framed by – a theoretical-interpretive analysis of a legal nature regarding the necessary in-depth examinations and normative, jurisprudential, and doctrinal frameworks, especially with reference to the principle of subsidiarity, with some empirical implications particularly regarding the functioning of local administration.

Preliminary Hypotheses and Propositions

• The municipality is simultaneously the level of government closest to the citizen, an entity with general administrative competence, and an actor with high multifactoriality: the budget cannot, therefore, be reduced to a merely accounting document.

• The phenomenon of financial distress highlights the loss of value in local communities.

• Predicting financial default ensures the widest realization of the principle of subsidiarity.

• The current size and structure of most Italian municipalities are incompatible with the complexity of contemporary public governance; therefore, Unions of Municipalities or other structured forms of inter-municipal cooperation can represent institutional innovations capable of preserving local identity while achieving economies of scale.

• The municipality, if adequately equipped and integrated into a multi-level governance system, can become a platform for democratic innovation and the implementation of the principle of subsidiarity, rather than an obstacle.

Expected Results and Conclusions

The research is expected to support (or refute) the hypothesis of how the municipality – despite its current and widespread structural fragility – can be rethought as a key actor in a governance model inspired by subsidiarity, provided that it is supported by a coherent regulatory framework, equipped with adequate resources, and integrated into a multi-level and multi-actor governance system. Inter-municipal cooperation emerges as the most promising strategy to resolve the paradox of fragmentation without sliding towards forms of centralization. The use of data for policy development and planning, and the diffusion of collaborative practices, indicate that municipalities can evolve into ‘intelligent nodes’ of territorial governance. In this scenario, the traditional distinction between governors and governed tends to blur, opening spaces for new democratic practices aimed at strengthening institutional trust where value is co-generated.

Problems and Challenges

Several challenges may arise. Firstly, the well-documented issue of data availability and quality at the municipal level requires attention to recent technological and regulatory innovations aimed at improving local policy; a potential normative bias, assuming the inherent positivity of subsidiarity and inter-municipal cooperation, could overshadow the significant influence of local dynamics (e.g., political resistance, institutional inertia); the heterogeneity of regional contexts in Italy and Europe complicates the transferability of research findings; the ongoing profound regulatory transformations, particularly those stemming from the Next Generation EU plan and national reforms like the adoption of IPSAS/EPSAS standards, significantly impact the local government sector. Finally, while the study aims to propose operational institutional reforms, their effective implementation will depend on political will and administrative capacity across various levels of governance.

A well-studied domain within public management studies is that of autonomy (e.g., Bach, Verhoest & Wynen, 2022; Rommel & Verhoest, 2014). Depending on their legal status and outlined in instruments such as management agreements, public sector organizations enjoy a certain formal autonomy (de jure) to decide on strategies and resource allocation (Maggetti, 2007; de Kruijf & van Thiel, 2018). However, the degree of autonomy public organizations have in practice (de facto autonomy) might diverge substantially from this formal autonomy (Yesilkagit & van Thiel, 2012; Maggetti, 2012). This can be problematic, leading to some organizations underutilizing their autonomy and failing to achieve their societal goals, while others might maximize and expand it, resisting political control.

Several theoretical perspectives try to explain the divergence between de facto and formal autonomy (Wynen & Verhoest, 2016). One of them is the organizational history perspective that highlights the role of path dependencies and institutional memory in shaping agency autonomy (Christensen & Lægreid, 2021). It emphasizes the idea of “logic of appropriateness”, where past experiences guide current practices (e.g. Christensen et al., 2007). However, systematic empirical studies on historical legacies and autonomy, are few (Pollitt, 2008; Zito, 2015). While some studies have used organizational age as a marker for organizational history, they fail to capture the complexity of past structural changes, not accounting for the number, sequence or complexity (Verhoest et al., 2010). The same is true for single-event studies (Seo & Hill, 2005; Amiot et al., 2006). In this paper, I therefore aim to examine the effects of histories of structural reform on the current autonomy of organizations building on the work by my supervisor Prof. dr. Jan Wynen & the team at the Knowledge Center for Politics & Public Governance UAntwerp, led by Prof. dr. Koen Verhoest (e.g. Kleizen, Verhoest, & Wynen, 2018; Wynen, Verhoest, & Kleizen, 2019).

With regards to the research question, two possible outcomes can be expected:

- Organizations that have experienced a greater degree of structural changes will have less de facto autonomy as they feel heavily dependent on their political principals as a result of these changes, no longer fully utilizing their autonomy (Barnett & Coleman, 2005). Structural reforms can be interpreted as forms of control leading to risk-averse behavior (cf. threat-rigidity theory; Staw et al, 1981; Kleizen, Verhoest, Wynen, 2018).

- The reverse is also possible. It may be argued that organizations will attempt to ensure their own autonomy by securing necessary resources elsewhere (Carpenter & Krause, 2012).

This study applies the research questions to the context of urban and municipal museums in Flanders. Since the 1980s, the cultural sector has undergone reforms aligned with broader public sector transformations (Kann-Rasmussen & Rasmussen, 2021). Furthermore, museums are increasingly expected to engage with societal issues, yet tensions often arise between their professional autonomy and political expectations that are frequently shaped by ideological agendas (Schramme, 2020). Research shows that governments all over Europe, have instrumentalized museums to promote specific political narratives (Baere et al., 2022). As in Flanders specifically, the cultural sector on the one hand is heavily dependent on government funding (limiting their autonomy) while also having the opportunity to find funding elsewhere through f.e. sponsorships (opening up resources elsewhere),this heightens the challenge of reconciling museum autonomy with political primacy, making it a compelling case for exploring the dynamics of formal versus de facto autonomy.

Covering the period from 2014 to today, I will examine the impact of recent organizational histories on the autonomy of 25 museums that currently operate within an AGB (autonomous municipal company) structure. More specifically I will focus on the impact of the latest structural reform affecting all museums in the sample—their transition to the AGB structure— on their de facto autonomy in light of preceding developments over the last 10 years. The choice of AGB museums ensures uniformity while allowing for interesting comparisons due to their varied organizational histories, with some experiencing restructuring and instability, and others remaining stable for over a decade.

To construct a measure of the structural reform histories over the past 10 years, we rely on desk research. In Flanders, structural reforms are accurately measurable through statutes, management agreements and reports of municipal councils. All of this data will be entered into a database that will be based on the Belgian State Administration Database (BSAD) and its earlier developed Norwegian counterpart (NSAD) . Museums will be entered as entities, and within these entities ‘change events’ will be coded. These change events classify the type of structural change that occurs at a given date, following a typology first devised by Rolland & Roness (2011). As we are interested in the effects of reforms the autonomy within existing museums, only what they call “maintenance events” will be taken into account.

To assess de facto autonomy, we combine survey data with interviews from current museum directors. The survey draws partly from the COBRA questionnaire (Verhoest et al., 2004) , which was developed to study the autonomy of (semi-)autonomous public agencies. Widely used across Europe and well accepted in the field of PA, it captures how agencies from a senior manager perspective, relate to political and administrative principals, as well as their internal management practices. While this study adopts a core set of COBRA questions addressing several dimensions of autonomy (f.e. policy autonomy, HRM autonomy and financial management autonomy), it adds a key dimension on artistic autonomy, tailored to the museum sector.

The data analysis for this paper will initially be performed using fsQCA (fuzzy-set qualitative comparative analysis) given the complex context of the museum sector and the size of the sample. Unlike correlational methods that assess variables in isolation, fsQCA identifies combinations of conditions that are necessary and/or sufficient for an outcome—in this case, museum autonomy—while maintaining a strong link to individual cases (Rihoux & Lobe, 2009). The first insights from the QCA analysis will then be followed by qualitative insights from interviews to deepen the findings and reveal the highly contextual nuances related to the cultural sector.