Municipal financial resilience: four patterns of response to external shocks

This paper calls for a new focus on the financial resilience of governments, trying to identify patterns of financial behaviour in Italian municipalities at a juncture where economic downturn, fiscal crises and austerity are posing unprecedented challenges. A possible measure of financial resilience is proposed, as well as a classification of municipalities' approaches to financial resilience based on the scope and volatility of the budgetary position. From the combination of the two dimensions, four strategies are analyzed and discussed