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The Effect of Leadership and Adaptive Capacities on Local Government Performance: The Moderating Role of Management Innovation

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  • Emmanuel K. Danso
  • Robert A. Opoku

Abstract

This study investigates the effects of leadership and adaptive capacities on local government performance, with management innovation as a moderating factor. Using structural equation modeling, data from 360 employees across Ghana's municipal assemblies were analyzed. The results reveal that leadership capacity significantly enhances performance, though its interaction with management innovation was not significant. Adaptive capacity, when moderated by management innovation, positively impacts performance, demonstrating innovation's critical role in transforming adaptability into tangible outcomes. These findings advance capacity development literature by emphasizing the dependency of adaptive capacity on innovation and reinforcing leadership capacity as a key organizational resource, consistent with resource‐based view (RBV) and knowledge‐based view (KBV) theories. Practical implications include prioritizing leadership development and integrating innovation into public sector strategies to improve performance. The study provides theoretical insights, actionable recommendations, and a basis for future research on capacity development in local government systems, particularly in resource‐constrained public sector contexts.

Suggested Citation

  • Emmanuel K. Danso & Robert A. Opoku, 2025. "The Effect of Leadership and Adaptive Capacities on Local Government Performance: The Moderating Role of Management Innovation," Public Administration & Development, Blackwell Publishing, vol. 45(4), pages 344-360, October.
    • Handle: RePEc:wly:padxxx:v:45:y:2025:i:4:p:344-360
    DOI: 10.1002/pad.70000
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