Decentralized Governance Structures Research Articles

Building a Blockchain-Based Platform for Interbank Collaboration

ABSTRACT Organizations today are shifting toward collaborative forms of value creation and rely on digital technologies to operate interorganizational processes. This has led blockchain technology to gain considerable momentum, given its ability to foster collaboration among multiple actors. Nevertheless, despite its benefits, building a blockchain-based platform requires integrating heterogeneous needs and adapting to decentralized governance structures. This research investigates the successful deployment of a blockchain-based solution for interbank collaboration. Our empirical analysis focuses on the Spunta Banca DLT Project, initiated in 2017 to automate the interbank reconciliation processes in Italy, through the deployment of a permissioned blockchain-based solution. A qualitative analysis of interview data collected from project participants was conducted to gain insights on the process to build a blockchain-based platform for interbank collaboration. The findings of our exploratory case study reveal that successful deployment hinges on a sequential legitimacy-building process, encompassing pragmatic, normative, and cognitive legitimacy.

An Ambitious Artificial Intelligence Policy in a Decentralised Governance System: Evidence From Indonesia

This study investigates Indonesia’s ambitious artificial intelligence (AI) policy within the context of its decentralised governance structure. Through in-depth case studies in Jakarta, Central Java, and East Java, we analyse emerging AI-based policy responses and their challenges in a rapidly evolving technological landscape. Drawing from elite interviews conducted with central and local government officials and documentary research, this study offers rare insights into the local perspective on the struggle to accommodate the central government's ambitious plan with limited resources. This article finds that the divergence in the views and visions of AI between central and local governments has complicated the formulation and implementation of AI-based policies. Central authorities wield a dominant role, evident through regulatory mandates and a centralised decision-making approach that can potentially constrain local autonomy. This power asymmetry, coupled with the lack of specific AI-focused regulations, challenges local governments’ capacity to independently design and manage AI initiatives aligned with their unique contexts. Interestingly, instead of showing their resistance towards the ambitious national plan, local leaders have embraced AI policies, positioning them as innovative tools to enhance popularity in the lead-up to the 2024 general election.

A configurational perspective on design elements and user governance engagement in blockchain platforms

AbstractBlockchain technology offers the potential to create an open, decentralised governance structure that empowers stakeholders to participate in decentralised engagement. However, how blockchain platforms configure their design elements to establish and maintain decentralised systems with high levels of user governance engagement requires further research. This study investigates the key design elements of blockchain platforms and their ideal configurations for promoting user governance engagement. Due to the complex and interdependent nature of the design elements, we adopt a configurational perspective accompanied by a fuzzy set qualitative comparative analysis (fsQCA) to uncover complex nonlinear relationships among key conditions that are relevant to decentralised governance. Our research identifies five key design elements that facilitate distributed governance (Access to decision rights, Process visibility, Protocol automation, Incentives for developers/miners, and Incentives for other stakeholders) based on existing blockchain governance literature. We analyse 14 unique blockchain platform cases that adopted on‐chain governance. Our fsQCA results reveal three ideal types of blockchain governance configurations that are sufficient for high generative user governance engagement: Centralised incentive model, Impartial incentive model, and Automation‐driven model, whereas achieving high evaluative governance engagement requires the presence of all the design elements (Comprehensive model). Also, we found Access to decision rights and Protocol automation are necessary conditions for generative governance engagement, and Access to decision rights together with Process visibility is a combined necessary condition for evaluative governance engagement. Relevant theoretical and practical implications for platform designers as well as methodological implications for applying QCA to emerging IS phenomena are discussed.

Financial decentralization and third-Mission outputs: A comparative study of Higher Education contexts in Brazil and the United States

Third Mission (TM) drives universities to a purpose beyond their traditional role, especially in local socioeconomic and innovation ecosystems. To investigate the issue, we consider an exploratory and comparative study of two different governance systems of public universities (Southeast Brazil-region 1 and Texas-US-region 2). The comparison took into account data from international universities' rankings performance to address TM and the structure of financial sources to address financial decentralization. The available evidence seems to suggest a positive association between the level of financial decentralization and the capability of the system of HE to deliver TM outputs. Universities under decentralized governance structures, which permit more autonomy to manage their resources, presented better results in most selected TM indicators. These findings reinforce the general belief that the governance arrangements that allow exploring synergies within local business ecosystems are more appropriate for ensuring organizational changes in the direction of entrepreneurial action.

A primer on the insurability of decentralized finance (DeFi)

Decentralized finance (DeFi), a blockchain-based form of alternative financial markets, has gained significant public attention in recent months. Despite its relatively short history, DeFi offers a range of opportunities for designing and transferring digital assets. This establishes market structures that bear resemblance to traditional financial markets. Notably, the landscape of DeFi projects has expanded to include insurance protocols that offer DeFi-inherent mechanisms for hedging DeFi-specific risks, particularly those associated with smart contracts. These insurance protocols aim to provide similar value propositions as traditional insurance, namely the minimization and transfer of risks in exchange for a premium. However, it is crucial to acknowledge that most of these risk transfer protocols are strongly dependent on subjective expectations and decentralized governance structures. This article aims to develop a taxonomical understanding of DeFi insurance. Moreover, it seeks to assess the insurability of risks related to smart contracts. By doing so, this study contributes to the emerging body of knowledge surrounding DeFi insurance, paving the way for further research and analysis in this evolving field.

Implications of decentralisation for disaster governance in Nepal’s federalism: Case study of COVID-19 response of four selected local governments

Nepal’s entry into federalism in 2015 resulted in a decentralised governance structure with constitutionally mandated legislative, executive and judicial functions for local governments. Existing research shows that devolving discretionary authority and resources to local governments is a necessary but not a sufficient condition for effective local responses during crises. However, there remains a need for deeper understanding about what makes local governments effective in responding to people’s needs during crisis times. Adopting a qualitative approach, this research analyses how decentralisation shapes local government responses in times of distress. We ask: How did local governments in Nepal respond to urgent needs during the COVID-19 pandemic – and what has been learned from this crisis that can make local governments better prepared for future challenges? Findings of this study show that the effective governance response to the crisis depends on several factors such as existing infrastructure development, availability of human and financial resources, political connections of local leadership, and local leaders’ ability to envision and execute the plans in a highly uncertain and quickly developing situation. The local government’s response to COVID-19 in Nepal shows the important role of decentralised local governance in combating crises, but there remain several critical challenges to make local governments more effective. In particular, we argue that it is essential to ensure sustained access to financial resources, strengthen human resource capabilities through training and capacity building activities, and prepare local governments to deliver important services in the context of disaster situations.

Role of economic complexity and government intervention in environmental sustainability: Is decentralization critical?

While climate change mitigation agenda and energy governance are the central concerns of climatologists and energy-environmental scientists, the mainstream literature seems silent on whether a decentralized governance structure is desirable for complex economic systems and governmental intervention approaches to realize sustainable environments. To frame this critical research gap, we investigate the contribution of fiscal decentralization in moderating the influence of economic complexity and government intervention on energy and carbon efficiency in the presence of real GDP per capita. We employ a panel method of moments quantile regression (MQR) on data from selected seven fiscally decentralized OECD countries over the 1995–2018 period. The empirical results uncovered that economic complexity causes a drop in energy efficiency (at 1, 5, and 10% significance levels), with a more magnified effect in countries with low environmental sustainability levels. Conversely, our findings exerted that government intervention discourages energy and carbon intensity (at diversified significance levels as per probability scores of 0.01, 0.05, and 0.10), with heterogeneous degrees of impact across diversified model specifications. Regarding direct influence, our outcomes exhibited that expenditure and revenue decentralization aid in energy and carbon efficiency. Concerning moderation effects, expenditure and revenue decentralization successfully rejuvenate the environmental sustainability effects of economic complexity and government intervention (at 1 and 5% significance levels). Finally, our study gauged that the EKC phenomenon exists among the sampled OECD members, indicating that economic growth in the region will be the driving force behind the region's long-term environmental sustainability. Estimation results are robust to the alternative dependent variable, carbon intensity and alternative econometric technique, ordinary least squares with Driscoll-Kraay standard errors. A fiscally decentralized paradigm is desirable from a policy standpoint for government intervention in complex economies to realize environmental sustainability goals.

Towards a systematic understanding of blockchain governance in proposal voting: A dash case study

The transparent and immutable nature of blockchain provides incentives for organizations wishing to create and implement an open, decentralized governance structure. As members exercise their voting rights, a fault-tolerant record accumulates on the blockchain that can be analyzed to diagnose and intercept potential threats to the governing body. To date, there has not been a systematic study of on-chain governance with respect to voting. In this paper, we provide an analysis of blockchain governance through a case study of the first cryptocurrency to adopt on-chain voting, Dash. Our analysis introduces the key characteristics of blockchain governance, steps through a data-driven exploration of Dash's on-chain voting system, and highlights exploitable attack vectors and vulnerabilities for the subversion of Dash's on-chain voting system via a novel network analysis methodology. We then conclude with guidelines for other organizations looking to implement similar blockchain governance solutions while maintaining integrity in their operations.

The new whole state system: Reinventing the Chinese state to promote innovation

This article joins interdisciplinary efforts to problematize dichotomous thinking (i.e. state vs. market, East vs. West, and new vs. old) in existing discourses concerning state capitalism. Focusing on the New Whole State System in relation to tech companies owned by Tsinghua University, we analyze the actually existing state capitalism in China as a spatiotemporally specific and conjuncturally situated assemblage of discourses, policies, and practices. We show that under both the Old Whole State System (1950s–1970s) and New Whole State System (mid-2000s onward) eras, the Chinese state, reacting to foreign economic and geopolitical pressures, attempted to graft a centralized innovation system onto preexisting decentralized governance structures, concentrating resources to promote selected strategic industries. Unlike the Old Whole State System, the New Whole State System relies on new policy tools characterized by state-led financialization and state–private fusion. The evolution of New Whole State System as an assemblage reveals that, contrary to the dominant geo-imaginary, the Chinese state is not monolithic, unchanging, and culturally essentialist. Rather, it is actively engaged in global debates about, and in contested experiments with expanding the state's role in the economy in response to global, conjunctural crises of overproduction and financialization. By foregrounding this non-Western country/region’s internal debate about its own development trajectory, its uneven success in overcoming uneven development, and its interaction with the rest of the world, we propose an alternative perspective that contributes both theoretically and methodologically to the epistemologically Euro-American centric literature of state capitalism.

The shift to consensus democracy and limits of institutional design in Asia

A ‘majoritarian turn’ identified by scholars of Asian democracy in the 1990s saw the rise of mixed-member majoritarian electoral systems and more centripetal party competition across both Northeast and Southeast Asia. In this paper, we argue that since the 2000s, the institutional pendulum has shifted, with more consensual approaches to democracy appearing to better represent key identity cleavages of gender, ethnicity, and territory—a trend evident not just in East Asia but South Asia as well. This new ‘Asian model’ typically involves increasing the proportional components of existing electoral formulas and grafting gender quotas, multiethnic party lists, and quasi-federal elements onto ostensibly majoritarian state structures. We show that these reforms have, as intended, mostly increased female and ethnic minority representation and decentralized governance structures. At the same time, however, these de jure changes are not associated with de facto political development in terms of greater democratic quality, counter to theoretical expectations. Indeed, democracy has declined across most of Asia at the same time as its democratic institutions have become more consensual.

An Assessment of Covid-19 Factors which Influence Non-Compliance of Payments in Respect of Social Security Contributions in Ghana

COVID-19 has been wreaking havoc on the business world for nearly two years, with most industries experiencing a significant decline in revenue. The major statutory agency in charge of regulating employee pension schemes in Ghana, the Social Security National Insurance Trust (SSNIT) Ghana, has also seen a drop in monthly contributions. As a result, the goal of the study was to see how the COVID-19 epidemic is affecting non-compliance with Ghana’s Social Security Monthly Contribution Payments. The study used a random sampling methodology to select 6 out of 19 decentralized governance structures in Accra, after which a purposive selection method was used to select 50 small and medium business enterprises for their perspectives on the study’s goals. The major research tool was the questionnaire, and the Statistical Package for Social Science (SPSS) was used to analyze the data collected in the field. COVID-19 appears to be taking a toll on the finances of small and medium-sized businesses that have made deals with SSNIT authorities to reschedule obligations related to default contributions, according to the findings. Although new projects have been placed on hold due to diminishing inflows, SSNIT’s commitment to employees and payment of pensions to elderly residents remains unaffected. In light of the a fore mentioned challenges posed by the pandemic, the study suggested that the Government of Ghana should seek concessionary loans from world-class lenders such as the World Bank to strengthen its local stabilization fund and inject a significant amount of funds to assist struggling SMEs in resuming operations.

An argument for place-based policies: The importance of local agro-economic, political and environmental conditions for agricultural policies exemplified by the Zambezi region, Namibia

This article outlines the importance of place-based policies derived from knowledge on local realities. Through an analysis of maize policies and their impact on the Zambezi region, Namibia, we illustrate the constraining limitations of insufficiently place-based policies. We highlight the problems of current top-down policies of production promotion, value chain integration, and sector protection which barely integrate region-specific knowledge. We emphasize the importance of integrating knowledge on soil, climate, water conditions, production capacities, and local farming practices. Based on our analysis, we recommend a more knowledge- and place-based policy including a multidimensional perspective, adapted agricultural management, and open decentralized governance structures that engages region-specific agricultural, economic, political, and environmental knowledge.

Turning the world on its head: The virus that disrupted “business as usual”

Turning the world on its head: The virus that disrupted “business as usual”

Policy coherence in a fragmented context: the case of biogas systems in Brazil

Policy mixes are needed to overcome the different barriers hindering sustainability transitions. This creates the need for policy coherence. Policy coherence studies in sustainability transitions literature are dominated by European cases, limiting their generalizability. This article analyzes policy mixes related to biogas systems and their related coherence issues, and, how that influences biogas production and use in Brazil. We identified policy coherence within and between biogas related sectors and over time, showing how the pre-conditions for biogas production, distribution and use differ considerably between the Brazilian states. This points to a need for decentralized governance structures to enable policy differentiation, as a complement to policy coherence. The article concludes that the characteristics of biogas systems as being locally embedded constitutes a challenge in hierarchical market economies such as Brazil, where policy development, resource mobilization and allocation are highly centralized.

Democratic Decentralization and Participatory Development: Focus on Bangladesh

In recent decades, developing Asian nations have witnessed the emergence of democratic decentralized governance structures, and with it a shift towards a more people-centric approach to development. Proponents claim the new approach can humanize bureaucracies and provide solutions to problems of poverty and social inequity. Despite their popularity, difficulties in implementation have been found, and questions are now being asked about the ‘real’ effectiveness of such frameworks. Discussing first the tenets of participatory development and its symbiotic relationship with democratic decentralized on this paper looks at the challenges faced in decentralizing a decentralized participatory framework and the critical components needed for success. It draws on examples from within developing Asia to highlight the many complexities of the issue, such as different cultural beliefs, political forces, administrative arrangements and varying perceptions. It argues that where incorrectly implemented, a decentralized participatory structure can prove ineffective for local people, in some cases leading to practical disillusions and further disadvantage.

Exploring patterns of forest governance quality: Insights from forest frontier communities in Zambia’s Miombo ecoregion

Good forest governance is a prerequisite for sustainable forest management and the successful implementation of initiatives that aim to reduce deforestation and forest degradation. The necessity for good governance is high in Zambia’s Miombo ecoregion, which is characterised by persistent deforestation that also threatens forest-dependent livelihoods. Zambia has adopted policies and initiatives to improve forest governance. We use the Governance of Forests Initiatives (GFI) indicator framework from the World Resource Institute in 24 communities in the Miombo ecoregion to examine Zambia’s status in this respect. The Wilcoxon rank test is applied to compare the de facto governance performance between different arrangements with differing tenures and restrictions to forest access and use. We employ factor analysis to test the applicability of the GFI framework based on community perceptions and cluster analysis to examine whether patterns of community clusters reflect the governance structure of the provincial local government administration. Comparative results show low mean scores for governance indicators, which do not differ significantly between arrangements. This indicates a weak de facto forest governance performance across arrangements, specifically characterised by an inadequate enforcement of rules and restrictions on use, insufficient institutional financial, human and technical capacities and unsatisfactory participatory land use planning and forest policy-making processes. We recommend support for financial and technical institutional capacities combined with coordination mechanisms to permit the satisfactory enforcement of forest rules. Frequent monitoring, apprehension and graduated sanctions are proposed as part of the rule enforcement procedures. Stringent de jure requirements coupled with capacity building for participatory land use planning and public policy participation also need to be adopted. This would also contribute towards achieving targets for Zambia’s climate change response strategy, national development plan 2017–2021 and REDD + preparedness phase. The factor analysis largely confirms the GFI framework’s suitability for governance analysis on the ground since factors generally mirror GFI indicators. However, because de facto governance processes sometimes do not precisely reflect thematic areas of the framework, we warn against the use of single indicators to exclusively represent a thematic area. Similarly, specific attention has to be paid to customary rules and institutions when applying the GFI framework because compared to the framework, the respective aspects are more clearly differentiated on the ground. Cluster analysis reveals a high variability of governance processes within and across provinces. Decentralization measures should take into account clusters that may in some cases follow administrative levels or in other cases go beyond the established administrative boundaries. Specifically, initiatives to integrate customary structures into the decentralized governance structure should take these regional differences into account.

The Political Economy of Blockchain Governance

We develop a theory of blockchain governance using tools from formal political theory. The software underlying blockchain projects is frequently updated (forked) to implement new policies, and these forks are the subject of our inquiry. We investigate the ways in which the decentralized governance structure and preferences of users influence which policies are implemented, considering network effects as well as user preferences for different policies. We describe several types of forks and identify the strategic conditions necessary for each. We show that network-effects can motivate less moderate policy proposals, and highlight the role of market frictions created by cryptocurrency exchanges in promoting non-contentious forks that are adopted by all users. The model explains counter-intuitive phenomena that have been observed in the governance of blockchain systems.

Institutional innovations in public participation for improved local governance and urban sustainability in India

BackgroundImproving urban governance is an imperative for India, with its accelerated rate of urbanization, distrust of government, and inadequate public involvement in policy development and decision-making. Deliberative democracy initiatives in other parts of the world, and similar experiences in rural India have demonstrated their effectiveness at resolving complex issues with decisions that are acceptable to constituents, and are seen to be in the public good.ResultsLearnings are drawn from two cases of action research in Pune, India about achieving inclusion and deliberation in public engagement efforts, and their influence on public decision-making. The stratified and complex socio-economic and political context in India, power imbalances, inadequacy of decentralized governance structures, and information for civic decision-making makes public engagement challenging. From this experience, we inductively developed a potential framework for good governance, of deliberative democracy initiatives (induced participation), inclusive civil society (organic and invented) participation, overseen by an independent third party. It is contended that such a framework can enable city governments, in India and elsewhere, to resolve complex urban sustainability challenges with more implementable decisions.ConclusionsBased on what was learnt from the Pune case studies, this article suggests that a combination of leaders willing to pioneer good governance, capable third-party facilitators, and strong organic participation groups working together through the structured approaches of deliberative democracy can effectively integrate the public into civic decision-making. However, to implement deliberative democracy in urban areas in India, the framework proposed will require advocacy at multiple levels. It will be critical to find ‘champions’ within political, administrative and civil society willing to pioneer deliberative democracy initiatives, to build professional capacity to conduct high quality deliberation, and to ensure the outcomes of such processes are influential. Good governance will rely on an ecosystem supporting such democratic renewal.

Towards a Systematic Understanding of Blockchain Governance in Proposal Voting: A Dash Case Study

The transparent and immutable nature of the blockchain provides incentives for organizations wishing to create and implement an open, decentralized governance structure. As members exercise their voting rights, a fault tolerant record accumulates on the blockchain that can be analyzed to diagnose and intercept potential threats to the governing body. To date, there has not been a systematic study of on-chain governance with respect to voting. In this paper, we provide an analysis of blockchain governance through a case study of the first cryptocurrency to adopt on-chain voting, Dash. Our analysis introduces the key characteristics of blockchain governance, steps through a data-driven exploration of Dash's on-chain voting system enabled only by the transparent nature of the blockchain and highlights exploitable attack vectors and vulnerabilities for the subversion of Dash's on-chain voting system via a novel network analysis methodology before concluding with guidelines for other organizations looking to implement similar blockchain governance solutions while maintaining integrity in their operations.

Governing Fairtrade: ethics of care and justice in the Argentinean wine industry

ABSTRACT Globally, Fairtrade practices its ethic of trade justice and governs its multiple stakeholders through a universalising set of regulations. However, this essentialises what are, in reality, disparate, dynamic and contextual experiences. Engaging with Argentinean wine and wine grape producers, alongside European regulators, highlights the inherent tensions to this system with Fairtrade’s global efforts being experienced as injustices at the producer level. This paper argues that overcoming the disconnect between ‘justice-as-universal’ and ‘care-as-particular’ is essential; combining these ethics will make Fairtrade’s governance more responsive to the place-based realities of how it is actually experienced and lived. The institutionalisation of Fairtrade has precluded alternative ideas of thinking or doing trade justice and so more inclusive dialogues are needed to ensure all stakeholders can participate. Fairtrade needs to bridge its scales of operation through a decentralised governance structure to allow for fluid and direct discussions and actions over its rhetoric, practices and impacts. This is an important step towards actualising everyday care-full trade justice.