IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v160y2023ics0148296323001224.html
   My bibliography  Save this article

Metaverse governance: An empirical analysis of voting within Decentralized Autonomous Organizations

Author

Listed:
  • Goldberg, Mitchell
  • Schär, Fabian

Abstract

In this paper we explore the importance of platform governance. We discuss various problems of centralized architecture in the context of the metaverse or sharing economy applications which may lead to monopoly market structures. We argue that open standards and blockchain-based governance can potentially mitigate some of these issues. We then collect governance data from the first blockchain-based virtual world and conduct an empirical analysis to study voter behavior within Decentralized Autonomous Organizations (DAOs). We provide empirical evidence that open standards and blockchain-based governance are a necessary but not a sufficient condition for a decentralized and neutral platform. Centralization and concentrated voting power may lead to dependencies, rent extraction behavior and create hold-up problems. Consequently, producers, prosumers and service providers must evaluate the governance structure of the platform before establishing a presence.

Suggested Citation

  • Goldberg, Mitchell & Schär, Fabian, 2023. "Metaverse governance: An empirical analysis of voting within Decentralized Autonomous Organizations," Journal of Business Research, Elsevier, vol. 160(C).
    • Handle: RePEc:eee:jbrese:v:160:y:2023:i:c:s0148296323001224
    DOI: 10.1016/j.jbusres.2023.113764
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296323001224
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2023.113764?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Battaglini, Marco & Morton, Rebecca & Palfrey, Thomas, 2007. "Efficiency, Equity, and Timing of Voting Mechanisms," American Political Science Review, Cambridge University Press, vol. 101(3), pages 409-424, August.
    2. Fabian Schär, 2021. "Decentralized Finance: On Blockchain- and Smart Contract-Based Financial Markets," Review, Federal Reserve Bank of St. Louis, vol. 103(2), pages 153-174, April.
    3. Williamson, Oliver E, 1979. "Transaction-Cost Economics: The Governance of Contractural Relations," Journal of Law and Economics, University of Chicago Press, vol. 22(2), pages 233-261, October.
    4. Giang Barrera, Kevin & Shah, Denish, 2023. "Marketing in the Metaverse: Conceptual understanding, framework, and research agenda," Journal of Business Research, Elsevier, vol. 155(PA).
    5. Pazaitis, Alex & De Filippi, Primavera & Kostakis, Vasilis, 2017. "Blockchain and value systems in the sharing economy: The illustrative case of Backfeed," Technological Forecasting and Social Change, Elsevier, vol. 125(C), pages 105-115.
    6. West, Joel, 2003. "How open is open enough?: Melding proprietary and open source platform strategies," Research Policy, Elsevier, vol. 32(7), pages 1259-1285, July.
    7. Burgelman, Robert A., 2002. "Strategy as Vector and the Inertia of Co-evolutionary Lock-in," Research Papers 1745, Stanford University, Graduate School of Business.
    8. de Villiers, Charl & Kuruppu, Sanjaya & Dissanayake, Dinithi, 2021. "A (new) role for business – Promoting the United Nations’ Sustainable Development Goals through the internet-of-things and blockchain technology," Journal of Business Research, Elsevier, vol. 131(C), pages 598-609.
    9. Alex Pazaitis & Primavera De Filippi & Vasilis Kostakis, 2017. "Blockchain and Value Systems in the Sharing Economy: The Illustrative Case of Backfeed," The Other Canon Foundation and Tallinn University of Technology Working Papers in Technology Governance and Economic Dynamics 73, TUT Ragnar Nurkse Department of Innovation and Governance.
    10. Ye, Yu & Yu, Qionglei & Zheng, Yongjun & Zheng, Yi, 2022. "Investigating the effect of social media application on firm capabilities and performance: The perspective of dynamic capability view," Journal of Business Research, Elsevier, vol. 139(C), pages 510-519.
    11. Alex Pazaitis & Primavera de Filippi & Vasilis Kostakis, 2017. "Blockchain and value systems in the sharing economy: The illustrative case of Backfeed," Post-Print hal-01676881, HAL.
    12. Farrell, Joseph & Klemperer, Paul, 2007. "Coordination and Lock-In: Competition with Switching Costs and Network Effects," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 31, pages 1967-2072, Elsevier.
    13. David Yermack, 2017. "Corporate Governance and Blockchains," Review of Finance, European Finance Association, vol. 21(1), pages 7-31.
    14. Edward Castronova, 2002. "On Virtual Economies," CESifo Working Paper Series 752, CESifo.
    15. Falkinger, Josef, 2007. "Attention economies," Journal of Economic Theory, Elsevier, vol. 133(1), pages 266-294, March.
    16. Gillespie, Tarleton & Aufderheide, Patricia & Carmi, Elinor & Gerrard, Ysabel & Gorwa, Robert & Matamoros-Fernández, Ariadna & Roberts, Sarah T. & Sinnreich, Aram & Myers West, Sarah, 2020. "Expanding the debate about content moderation: Scholarly research agendas for the coming policy debates," Internet Policy Review: Journal on Internet Regulation, Alexander von Humboldt Institute for Internet and Society (HIIG), Berlin, vol. 9(4), pages 1-29.
    17. Oswald Jones & Dilani Jayawarna, 2010. "Resourcing new businesses: social networks, bootstrapping and firm performance," Venture Capital, Taylor & Francis Journals, vol. 12(2), pages 127-152, January.
    18. Brian P. Bloomfield & Rod Coombs, 1992. "Information Technology, Control And Power: The Centralization And Decentralization Debate Revisited," Journal of Management Studies, Wiley Blackwell, vol. 29(4), pages 459-459, July.
    19. Egliston, Ben & Carter, Marcus, 2021. "Critical questions for Facebook's virtual reality: Data, power and the metaverse," Internet Policy Review: Journal on Internet Regulation, Alexander von Humboldt Institute for Internet and Society (HIIG), Berlin, vol. 10(4), pages 1-23.
    20. Timothy Simcoe, 2012. "Standard Setting Committees: Consensus Governance for Shared Technology Platforms," American Economic Review, American Economic Association, vol. 102(1), pages 305-336, February.
    21. Gligor, David M. & Pillai, Kishore Gopalakrishna & Golgeci, Ismail, 2021. "Theorizing the dark side of business-to-business relationships in the era of AI, big data, and blockchain," Journal of Business Research, Elsevier, vol. 133(C), pages 79-88.
    22. Tsolakis, Naoum & Niedenzu, Denis & Simonetto, Melissa & Dora, Manoj & Kumar, Mukesh, 2021. "Supply network design to address United Nations Sustainable Development Goals: A case study of blockchain implementation in Thai fish industry," Journal of Business Research, Elsevier, vol. 131(C), pages 495-519.
    23. Ganesh Iyer & Zsolt Katona, 2016. "Competing for Attention in Social Communication Markets," Management Science, INFORMS, vol. 62(8), pages 2304-2320, August.
    24. Hughes, Laurie & Dwivedi, Yogesh K. & Misra, Santosh K. & Rana, Nripendra P. & Raghavan, Vishnupriya & Akella, Viswanadh, 2019. "Blockchain research, practice and policy: Applications, benefits, limitations, emerging research themes and research agenda," International Journal of Information Management, Elsevier, vol. 49(C), pages 114-129.
    25. Ron Berman & Zsolt Katona, 2013. "The Role of Search Engine Optimization in Search Marketing," Marketing Science, INFORMS, vol. 32(4), pages 644-651, July.
    26. Schär, Fabian, 2020. "Blockchain Forks: A Formal Classification Framework and Persistency Analysis," MPRA Paper 101712, University Library of Munich, Germany.
    27. Hassan, Samer & De Filippi, Primavera, 2021. "Decentralized Autonomous Organization," Internet Policy Review: Journal on Internet Regulation, Alexander von Humboldt Institute for Internet and Society (HIIG), Berlin, vol. 10(2), pages 1-10.
    28. Belk, Russell & Humayun, Mariam & Brouard, Myriam, 2022. "Money, possessions, and ownership in the Metaverse: NFTs, cryptocurrencies, Web3 and Wild Markets," Journal of Business Research, Elsevier, vol. 153(C), pages 198-205.
    29. Li, You & Chang, Yaping & Liang, Zhehao, 2022. "Attracting more meaningful interactions: The impact of question and product types on comments on social media advertisings," Journal of Business Research, Elsevier, vol. 150(C), pages 89-101.
    30. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
    31. Christ, Katherine L & V Helliar, Christine, 2021. "Blockchain technology and modern slavery: Reducing deceptive recruitment in migrant worker populations," Journal of Business Research, Elsevier, vol. 131(C), pages 112-120.
    32. Benito Arruñada & Luis Garicano, 2018. "Blockchain: The birth of decentralized governance," Economics Working Papers 1608, Department of Economics and Business, Universitat Pompeu Fabra.
    33. Victor P. Goldberg, 1976. "Regulation and Administered Contracts," Bell Journal of Economics, The RAND Corporation, vol. 7(2), pages 426-448, Autumn.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Goldsby, Curtis M. & Hanisch, Marvin, 2023. "Agency in the algorithmic age: The mechanisms and structures of blockchain-based organizing," Journal of Business Research, Elsevier, vol. 168(C).
    2. Hyejin Park & Ivan Ureta & Boyoung Kim, 2023. "Developing Dimensions and Indicators to Measure Decentralization in Decentralized Autonomous Organizations," Administrative Sciences, MDPI, vol. 13(11), pages 1-15, November.
    3. Alawadi, Asma & Kakabadse, Nada & Kakabadse, Andrew & Zuckerbraun, Sam, 2024. "Decentralized autonomous organizations (DAOs): Stewardship talks but agency walks," Journal of Business Research, Elsevier, vol. 178(C).
    4. Campbell R. Harvey & Daniel Rabetti, 2024. "International business and decentralized finance," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 55(7), pages 840-863, September.
    5. Saurabh, Kumar & Rani, Neelam & Upadhyay, Parijat, 2024. "Towards novel blockchain decentralised autonomous organisation (DAO) led corporate governance framework," Technological Forecasting and Social Change, Elsevier, vol. 204(C).
    6. Tan, Teck Ming & Salo, Jari & Brashear Alejandro, Thomas G. & Wei-Han Tan, Garry & Ooi, Keng-Boon & Dwivedi, Yogesh K., 2024. "Guest editorial: A blockchain-based approach to marketing in the sharing economy," Journal of Business Research, Elsevier, vol. 177(C).
    7. Gupta, Rohit & Rathore, Bhawana & Biswas, Baidyanath & Jaiswal, Mahadeo & Singh, Raunak Kumar, 2024. "Are we ready for metaverse adoption in the service industry? Theoretically exploring the barriers to successful adoption," Journal of Retailing and Consumer Services, Elsevier, vol. 79(C).
    8. George Saridakis & Zaheer Khan & Gary Knight & Bochra Idris & Jay Mitra & Huda Khan, 2024. "A Look into the Future: The Impact of Metaverse on Traditional Theories and Thinking in International Business," Management International Review, Springer, vol. 64(4), pages 597-632, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Santana, Carlos & Albareda, Laura, 2022. "Blockchain and the emergence of Decentralized Autonomous Organizations (DAOs): An integrative model and research agenda," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    2. Giuliano Sansone & Flavio Santalucia & Davide Viglialoro & Paolo Landoni, 2023. "Blockchain for social good and stakeholder engagement: Evidence from a case study," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(5), pages 2182-2193, September.
    3. Hakkarainen, Tuuli & Colicev, Anatoli, 2023. "Blockchain-enabled advances (BEAs): Implications for consumers and brands," Journal of Business Research, Elsevier, vol. 160(C).
    4. Yazıcı, Ali Fırat & Olcay, Ali Bahadır & Arkalı Olcay, Gökçen, 2023. "A framework for maintaining sustainable energy use in Bitcoin mining through switching efficient mining hardware," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    5. Teck Ming Tan & Jari Salo, 2023. "Ethical Marketing in the Blockchain-Based Sharing Economy: Theoretical Integration and Guiding Insights," Journal of Business Ethics, Springer, vol. 183(4), pages 1113-1140, April.
    6. Dulani Jayasuriya Daluwathumullagamage & Alexandra Sims, 2021. "Fantastic Beasts: Blockchain Based Banking," JRFM, MDPI, vol. 14(4), pages 1-43, April.
    7. Min Xu & Xingtong Chen & Gang Kou, 2019. "A systematic review of blockchain," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 5(1), pages 1-14, December.
    8. Olivier Meier & Aurélie Sannajust, 2021. "The smart contract revolution: a solution for the holdup problem?," Small Business Economics, Springer, vol. 57(2), pages 1073-1088, August.
    9. Hsuan-Yu Lin & Chih-Hai Yang, 2016. "Uncertainty, specific investment, and contract duration: evidence from the MLB player market," Empirical Economics, Springer, vol. 50(3), pages 1009-1028, May.
    10. Emmanuelle Reuter, 2022. "Hybrid business models in the sharing economy: The role of business model design for managing the environmental paradox," Business Strategy and the Environment, Wiley Blackwell, vol. 31(2), pages 603-618, February.
    11. Olivier Meier & Aurélie Sannajust, 0. "The smart contract revolution: a solution for the holdup problem?," Small Business Economics, Springer, vol. 0, pages 1-16.
    12. Islam, A.K.M. Najmul & Mäntymäki, Matti & Turunen, Marja, 2019. "Why do blockchains split? An actor-network perspective on Bitcoin splits," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    13. Kajikawa, Yuya & Mejia, Cristian & Wu, Mengjia & Zhang, Yi, 2022. "Academic landscape of Technological Forecasting and Social Change through citation network and topic analyses," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    14. Nallapaneni Manoj Kumar & Shauhrat S. Chopra, 2022. "Leveraging Blockchain and Smart Contract Technologies to Overcome Circular Economy Implementation Challenges," Sustainability, MDPI, vol. 14(15), pages 1-18, August.
    15. Mikko Ketokivi & Joseph T. Mahoney, 2020. "Transaction Cost Economics As a Theory of Supply Chain Efficiency," Production and Operations Management, Production and Operations Management Society, vol. 29(4), pages 1011-1031, April.
    16. Kareem Mohamed & Amr Aziz & Belal Mohamed & Khaled Abdel‐Hakeem & Mostafa Mostafa & Ayman Atia, 2019. "Blockchain for tracking serial numbers in money exchanges," Intelligent Systems in Accounting, Finance and Management, John Wiley & Sons, Ltd., vol. 26(4), pages 193-201, October.
    17. Pritpal Singh BHULLAR & Dyal BHATNAGAR, 2020. "Bitcoins as a determinant of stock market movements: A comparison of Indian and Chinese Stock Markets," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(624), A), pages 193-202, Autumn.
    18. Ana Čuić Tanković & Marina Perišić Prodan, 2024. "Digital Natives' Attitudes towards Blockchain Technology Usage," Central European Business Review, Prague University of Economics and Business, vol. 2024(3), pages 75-93.
    19. Heikki Marjosola, 2021. "The problem of regulatory arbitrage: A transaction cost economics perspective," Regulation & Governance, John Wiley & Sons, vol. 15(2), pages 388-407, April.
    20. Samuel BRÃœLISAUER & Anastasia COSTANTINI & Gianluca PASTORELLI, 2020. "The Digital Social Economy - Managing and Leveraging Platforms and Blockchain for a People-Centred Digital Transformation," CIRIEC Working Papers 2011, CIRIEC - Université de Liège.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:160:y:2023:i:c:s0148296323001224. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.