Decentralized governance: Empowering algorithms and autonomous organizations

During the last few years, Decentralized Autonomous Organizations (DAOs) have had a positive impact on organizations and disrupted governance and decision-making processes. This chapter concentrates on this important area and discusses algorithmic governance and DAOs. It pays attention to DAO governance mechanisms and sheds light on eight well known mechanisms, such as token-based quorum voting, quadratic voting, and weighted voting. Each model has its advantages and disadvantages, and there is therefore a need for a better understanding and assessment of these models. To do so, we explore governance dimensions such as efficiency and decentralization and define evaluation criteria. The research reported in this chapter enhances the understanding of this area and lays the foundations for the assessment of these mechanisms. The analysis reported in the following sections contributes to a better comprehension of these mechanisms and supports organizations and researchers when reviewing them. The chapter is considered the starting point for a systematic assessment and analysis of DAO governance mechanisms, and it will be followed by other articles that will conceptualize an evaluation framework and test it in the practical arena.