The increased uncertainty, volatility and complexity under which governments operate have put great emphasis on how governments respond to shocks and crises. Extant research has mostly studied the causes of and reactions to recent crises, some focusing on local government, with a relative paucity of research on how accounting is implicated in crisis responses at the organizational level. More research is needed to understand how accounting informs responses to crises and shocks influencing perceptions of organizational financial vulnerability and, more generally, affecting organizational capacity to anticipate shocks.
This paper builds on previous research on governmental financial resilience to understand how local governments’ responses to shocks are shaped by organizational perceptions of financial conditions and the presence of anticipatory capacities. The concept of financial resilience has been shown to uncover internal capacities that act as shaping forces during crises, contributing to and informing “bouncing back” or “bouncing forward” response strategies. Based on a survey of over 600 local governments in Germany, Italy, and the UK, this paper looks at the role that anticipatory capacities, and associated vulnerabilities, play in determining organizational response strategies (bouncing back vs. bouncing forward) at times of crisis
