Organizational complexity and participatory innovation: participatory budgeting in local government

ABSTRACT

In this study, we examined the relationship between organizational complexity and the adoption of participatory innovation in German municipal government. We proposed that organizations with more complex organizational structures are more likely to adopt participatory innovation. We investigated municipalities (N = 394) of the German state of North Rhine-Westphalia and used participatory budgeting as an indicator for innovation. Our results indicate that organizational complexity expressed by functional differentiation has a positive relationship with the occurrence of participatory innovation. The results inform a debate about the value trade-offs that are inherent to the structural design of public organizations.