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Researchers and practitioners around the world recognize the potential of information technologies to promote government transformation. This transformation has been understood in at least two different ways: (1) as a transformation of internal processes and (2) as a transformation of the relationships between governments and other social and political actors (institutional transformation). Unfortunately, there is little or no evidence of such transformation, and current studies reveal that for this transformation to happen, a better understanding of the complex relationships between information technologies, organizations, and institutions is still required. This paper presents a theory of the co-evolution of technology, organizational networks, and institutional arrangements in the transformation of government. The theory uses the grammars of system dynamics and builds upon institutional approaches to understand …