This article challenges the arguments of the new economics of organization (NEO) on the phenomenon of transparency in the public sector. This is achieved by conducting an empirical study of 16 federal agencies in Mexico, which analyzes the implementation of the federal transparency law. Our findings indicate that some organizations are developing internal dynamics well beyond those anticipated by the law, while others are just complying with the minimum legal requirements. We suggest that there is a dynamic of transparency ‘internalization’ in these organizations that the NEO has been neglecting, and also a basic contradiction in the construction of the NEO theory, which affects the design and implementation of transparency laws. Solving this problem would demand a change of the underlying paradigm that sustains transparency reforms. Instead of taking opportunism, selfishness, and a profound distrust attitude toward public servants as departure points, effective transparency reforms require trustworthy public officials in order to endorse and implement successful organizational transformations that foster public openness and transparency.
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