Data Driven Governance: Building Data Driven Accountability Based Regulatory Systems in the West and Social Credit Regimes in China

Abstract

Data driven governance systems are transforming the regulatory landscape of both states and other governance institutions. Grounded in principles of accountability and embedded in incentive based systems for reducing risk and managing behaviors through mechanisms of choice and markets, these governance systems may well reshape the way states and other governance organs are constituted and operate. This short essay has two objectives. The first is to examine the challenges that credit, ratings or assessment systems pose for effective implementation. Social Credit itself refers generally to a new mode of data driven governance through which data analytics are used to create and operate algorithms that provide a basis for rewards and punishment for targeted behaviors. More specifically, credit references the specific project of the Chinese state to create a comprehensive legal and regulatory mechanism grounded in data driven metrics that they have named social credit. To that end, Section II considers first the difficulties of separating the role of credit as a set of techniques and as a means of advancing ideological principles and objectives, in the context of Chinese efforts. Section III then examines some of the ways in which Western efforts at credit institutions have sought to meet similar challenges. The section first explores the context of credit systems in the West, and its operationalization, principally in the private sphere and through the use of market mechanisms for behavior management. It then examines the way that credit might be used in the West as a technique of governance and as a means of embedding international standards in domestic behavior. The essay concludes by suggesting that credit represents the expression of new forms of governance that are possible only through the correct utilization of big data management. The shift in regulatory forms also point to significant shifts in the relationship between law, the state and government. Accountability regimes grounded in behavior standards enforced through data driven analytics may well change the focus of public law from constitution and rule of law to analytics and algorithm.