Blockchain technology improves public services and generates administrative efficiency, study shows

It is a distributed ledger that tracks a set of transactions in a decentralized, secure and transparent way.
Administration
15 March 2024
Blockchain technology improves public services and generates administrative efficiency, study shows

Blockchain technology has emerged as a disruptive application in all sectors. It is a distributed ledger that tracks a set of transactions in a decentralized, secure and transparent way in the form of a chain of blocks (hence the name). To investigate the impacts of its use on key government functions, Maciel Queiroz, a researcher at Fundação Getulio Vargas’ Sao Paulo School of Business Administration (FGV EAESP), together with Samuel Fosso Wamba, Serge-Lopez Wamba-Taguimdje and Qihui Lu, wrote a paper on the subject that was published in Government Information Quarterly in February 2024.

Previous studies have shown that blockchain technologies are a powerful, essential and effective lever for transforming government processes and procedures and improving management and policies in the public sector. This technology offers valuable opportunities for organizations, such as transparency, privacy, security, risk control, democratization and reliability.

The researchers selected 167 projects focused on technology in the public sector from a mapping exercise by the Innovative Public Services Observatory (IPSO). An exploratory analysis was then carried out, which involved looking in-depth at the projects’ indicators in order to maximize the information obtained from the data. A Fuzzy-set Qualitative Comparative Analysis (fsQCA) approach was also applied. Thisis a method that identifies complex causal relationships between variables,making it possible to identify the conditions that led to the achievement of operational and administrative open governmentperformance goals.

The results show concrete evidence of how blockchain enhances key functions of government and its subsectors, influencing the governance of public services, administrative efficiency and open government capacity, while driving innovation and improving operational and administrative performance.

The study highlights the following effects of blockchain:

  • Reduced bureaucracy, discretion and corruption;
  • Increased automation, transparency, auditing and accountability of information for the benefit of citizens and other stakeholders;
  • Increased citizen and business confidence in government processes.

One crucial contribution of the system is its ability to promote a citizen-centric agenda, transparent governance and a decentralized approach to development.

Despite the benefits, the researchers recognize the challenges of blockchain, such as integration with existing systems, employee training and regulatory issues. This technology is in its early stagesin the public sector, but its transformative potential is evident, as shown by systematic analysis and tangible examples in the study. In terms of administrative efficiency, blockchain systems can reduce costs, improve the management of public resources, enhance the quality of processes, communication and collaboration, and reduce or eliminate corruption risks, thereby promoting justice and equality.

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