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Cryptodemocracy and its institutional possibilities

  • Darcy W. E. Allen
  • Chris Berg
  • Aaron M. Lane
  • Jason Potts
Article

Abstract

Democracy is an economic problem of choice constrained by transaction costs and information costs. Society must choose between competing institutional frameworks for the conduct of voting and elections. These decisions over the structure of democracy are constrained by the technologies and institutions available. As a governance technology, blockchain reduces the costs of coordinating information and preferences between dispersed people. Blockchain could be applied to the voting and electoral process to form new institutional possibilities in a cryptodemocracy. This paper analyses the potential of a cryptodemocracy using institutional cryptoeconomics and the Institutional Possibility Frontier (IPF). The central claim is that blockchain lowers the social costs of disorder in the democratic process, mainly by incorporating information about preferences through new structures of democratic decision making. We examine one potential new form of democratic institution, quadratic voting, as an example of a new institutional possibility facilitated by blockchain technology.

Keywords

Blockchain Cryptoeconomics Democracy New comparative economics Quadratic Voting 

JEL Classification

P50 B52 D72 

Notes

Funding

This study is funded by RMIT University.

Compliance with ethical standards

Conflict of interest

The authors declare they have no conflict of interest.

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  • Darcy W. E. Allen
    • 1
  • Chris Berg
    • 1
  • Aaron M. Lane
    • 2
  • Jason Potts
    • 1
  1. 1.Blockchain Innovation HubRMIT UniversityMelbourneAustralia
  2. 2.RMIT UniversityMelbourneAustralia

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