Some of the key functions of government agencies include reallocation of resources and maintenance of official records. These are precisely the areas where blockchain technology – with an emphasis on securing secure, traceable transactions and maintaining unchanging records to build trust – is well positioned to make a powerful impact.
A recent report from the Danish Ministry of Foreign Affairs is the latest to highlight the potential of blockchain technology as a powerful tool in the fight against government corruption. However, the proposal is the latest in a long line of policy proposals and policy analyzes that document the enormous promise that distributed reserve technology has for the government’s transparency lawyers, as well as the many limitations it will inevitably face.
Technological solutions to a chronic problem
Every government is a colossal complex of procedures, records, transactions and human bureaucrats who impose formal rules within their jurisdiction. These large and complex organizational structures often lack transparency and are difficult and expensive to understand, let alone supervise.
Officials who work directly with the flow of resources or have the right to sign an abuse of their authority for financial gain may be motivated if they understand that the risk of arrest is minimal. According to an estimate, public sector corruption consumes $ 1.5 to $ 2 trillion worldwide annually, which is about 2% of global GDP.
Many anti-corruption experts place their hopes on various digital technologies to contribute to the breakthrough. The Danish Ministry of Foreign Affairs’ report provides an overview of several possible ways to combat administrative and political corruption. One way is to make the entire public sector accessible to all and thereby increase transparency by allowing activists and regulatory agencies to carry out independent audits and identify suspicious public spending patterns.
The second proposed approach is to reduce the chances of corruption by expanding the scope of e-government and moving most public services over the Internet. In this area, the authors propose to use blockchains to simplify securities transactions and transparent and tamper-proof data. Another suggestion is to use crowdsourcing platforms to make it easier to report violations and complaints of minor corruption incidents.
Finally, the authors of the report propose using blockchain-based solutions to ensure the integrity of public records, property rights and digital protection of state aid. They highlight how this can not only improve the integrity of public records, but also provide groups that are subbank or have limited access to public services – for example, due to the lack of government-issued IDs.
The enthusiasm for these and other anti-corruption uses of blockchain is not new. In a 2018 Stanford Social Innovation Review article, Carlos Santiso, an expert at the Inter-American Development Bank, noted that a “bubble of expectation” has already emerged between the public and technology regarding the technological potential to reduce the impact of government. corruption. social communication.
Santiso argues that government technology in the digital age has steadily increased public transparency. In his view, blockchain technology is particularly well-suited for this effect due to its unique ability to secure correct records and eliminate inefficient data management practices inherent in traditional bureaucracy. That said, blockchain-based systems can help restore declining confidence in government.
Other observers say that instead of fixing declining trust in the government, blockchain could provide a whole new mechanism for building trust. A team of analysts representing the non-profit organization for corruption Transparency International notes in a research note that technology can be particularly useful in countries full of corruption, where trust in institutions is very low.