This book chapter, co-authored by Luis Luna-Reyes is published at https://link.springer.com/chapter/10.1007/978-3-032-00514-4_18

The adoption of artificial intelligence (AI) applications in state and local governments has fallen behind the private sector in the past years. Previous research addressed the beneficial impacts of AI on traditional government functions, including public service delivery, decision-making, and interaction between governments and citizens. However, organizational contexts such as administrative cultures and inadequate funding hinder AI implementation in local governments. This chapter adopts Mark Moore’s (Creating Public Value: Strategic Management in Government. Harvard University Press, 1995) public value theory as a framework to examine how adopting AI has impacted local governments’ operations. We identified 35 articles from 2013 to 2024 from four multi-disciplinary research online databases using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) 2020 guidelines for systematic literature reviews. The results suggest that the main domains of application of AI at the local level include digital government and services, sustainable planning, urban services, and public health; the potential value of AI varies across domains of application. Data sharing and AI knowledge are two operational capacities needed to create such value, and solving issues of ethics and governance appears to be key to creating the necessary support and authorization for AI systems. We suggest public managers collaborate with multiple stakeholders and develop a comprehensive AI deployment guidance with the alignment of technical and social characteristics of AI, national AI regulation, and users’ needs.