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Abstract

Digital transformation has become a structuring agenda for local government, yet its diffusion across municipalities is uneven and only partly understood. Dominant maturity models order governments along a single ladder and obscure qualitatively distinct configurations of capability. This study builds a typology of digital transformation for the near universe of Brazilian municipalities, combining information and communication technology (ICT) capabilities, digital government provision and administrative and fiscal resources, and examines how the types relate to socioeconomic and fiscal characteristics. Drawing on the 2024 IBGE Survey of Basic Municipal Information (MUNIC), the Siconfi fiscal accounts for 2023, the Municipal GDP series and the Basic Education Development Index, we construct twenty indicators, apply principal component analysis and k-means clustering validated against Ward hierarchical clustering, estimate a multinomial logistic model of type membership, and test spatial dependence with global and local spatial statistics. We identify four types for 4,786 municipalities, from digitally excluded to digitally advanced, with two intermediate configurations that reveal a decoupling of installed structure from effective use. Population size, income and educational performance are associated with a higher relative risk of higher-capability membership, whereas dependence on intergovernmental transfers is associated with a markedly lower one. Digital capability is strongly clustered in space, concentrating in the South and Southeast. The paper moves from the maturity ladder to a configurational reading of municipal digital capability, formalized in a Municipal Digital Capability framework that maps the types onto the axes of installed structure and effective use and specifies hypothesized dynamic-capability trajectories between them.