Microeconomic Explanation of Citizen Participation in Open Government

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1		María Verónica Alderete	--	1921	2024-01-04 23:05:29	\|
2	format correct	Catherine Yang	+ 1 word(s)	1922	2024-01-05 01:35:56	\|

This entry is adapted from the peer-reviewed paper 10.3390/jtaer19010003

The digital economy and the sharing economy have changed the role citizens may acquire in society. Citizens can perform at least two roles from the open government perspective: on the one hand, they can be passive users/demanders of information and, on the other hand, they can provide or produce the information in an active manner.

citizen participation utility function social goods sharing economy prosumer

1. Introduction

Nowadays, individuals are interested in assigning part of their time to produce/consume social goods. Examples of social goods are citizen participation, consumer sharing of their product/service experience, and open innovations such as open source communities, among others. In a society, the participation of individuals yields a critical role. In this sense, citizens who are participants in a political community become involved with each other with the purpose of creating and re-creating their political circumstances ^[1].

In recent years, prosumerism has become a special feature ^[2]^[3] since individuals are not only consumers but also producers of the goods/services. Nowadays, users can affect companies by simultaneously playing two roles: as value creators and as consumers. This trend has been eased by new information and communication technologies, especially social media. Value co-creation turned into a co-creation activity as a result of the arrival of Web 3.0 and social platforms ^[4]. For instance, people consume media on their electronic devices, such as mobile phones, tablets, etc.

Many business models have been conducted in response to the prosumer role of customers in renewable energy sources ^[5]^[6]^[7]. Moreover, several e-commerce activities create value from users or clients. This situation has become more evident during COVID-19. The main product is now created with the participation of customers in the innovation process. This innovation process is closely linked to use, value in use, and the concept that value can be determined only by the customer ^[8].

Moreover, the American Marketing Association also improved the definition of marketing by adding the concept of customer value to its definition. Social media platforms are used by several merchants for promotional activities encouraging consumers to forward information and invite online friends, so as to achieve the goal of spreading brands and promoting sales. Promotional information is not only transmitted from sellers to consumers but it is also more disseminated among consumers ^[9]^[10]. In this line, Hamidi ^[8] developed a conceptual framework for value co-creation in small- and medium-sized tourism agencies. On one hand, information technology and social media allow customers to give instant feedback to companies. On the other hand, companies can listen to their customers’ interests and opinions. In the field of open government and modern public administration, citizens have the right to access public information and to participate in public decision-making processes ^[1]^[11]. Citizen participation is one of the fundamental principles of the open government paradigm. Hence, a deeper involvement and engagement of citizens in local government decision processes is desired ^[12]. There are some recent empirical studies on open government and citizen participation. However, there is a lack of theoretical research on the topic. Moreover, citizen participation in open government projects is a critical topic for the development of smart cities ^[13].

2. Microeconomic Explanation of Citizen Participation in Open Government

Public goods are characterized by non-exclusivity and indivisibility principles. Non-exclusivity means that once public goods are produced, it is not feasible to prevent (at a reasonable cost) any individual from the benefits of the good, including those individuals who do not participate in the production. The second principle argues that the use of the good by one member of the community does not reduce the stock available to others. Due to both principles, the production of public goods is subject to a social dilemma since any rational agent will be prone to benefit from the good without participating in its production ^[14]. Many contemporaneous problems suffer from the public goods dilemma and the free rider problem. Therefore, the researchers wonder what the incentives that make a citizen participate in the production of social goods are; especially, the researchers focus on those related to open government such as citizen participation and collaboration.

On the other side, the ability of providers and consumers to enlarge their role and turn into prosumers recently have been considered as one of the critical characteristics of the sharing economy and a fundamental area for future research ^[15]. As argued by ^[16], all participants of the co-creation process contribute as value co-creators, who attain new offers through the integration of resources. Therefore, co-creation is assumed as an updated view to raise value for the firms and their customers. In the co-creation approach, value is co-created over a learning process that is continuous and interactive ^[17]^[18]. The user/client is involved in a collaborative way in all phases of service development from the problem definition to problem solving. Therefore, users/clients assume a proactive role as a collaborative partner in the creation of value ^[18].

Social innovation is mainly based on models of “civil intelligence”, “distributive social intelligence”, new models of emergence, and “participatory democracy” that reconsider older concepts of organizational science and learning and action research models within a technologized framework of the public good that depends on harnessing the full effects of new social movements, collaborative problem solving, and Web 2.0 applications. Peters ^[19] argues that the concept of social innovation has been built based on the idea of “open innovation”. Many authors define open innovation in the public sector in terms of the active participation of citizens, which is known with the term engagement. The economic theory that had started using the principles of social media then turned into a political theory of social innovation dedicated to solving collective problems based on the co-creation, co-design, and co-evaluation of social goods and services. The role of engaged citizens is crucial. Hence, in the same way, it has direct applications to the public sector and government. Open innovation, therefore, encourages organizations to look for external solutions. By implementing open innovation, the public sector benefits from some positive effects, such as more awareness of social problems, of citizens’ experience to achieve more effective practices, and of the relationship of trust between citizens and governments.

However, the least references are found with respect to citizen participation. Grazian and Nahr ^[20] examine the e-democracy tools and the type of role citizens can play by distinguishing two dimensions (active–passive and independent–dependent). Citizens’ passive involvement means consuming information about the actions of political representatives. Therefore, citizens are capable of monitoring the work performed by administrations and lastly, of understanding the decision-making processes. This active–passive distinction only applies to the citizens that utilize online participation tools, not to all types of participation. Then, while some tools request citizens to have a kind of monitoring role (passive), others invite them to perform a more active role in discussions, deliberations, or voting. This is what the active–passive dimension aims to cover.

Nelson and Wright ^[21], for example, emphasize the participation process as a transformative tool for social change. In addition, citizen involvement is intended to produce better decisions and, thus, more efficient benefits to the rest of society ^[22]^[23]. Thus, Irvin and Slansbury ^[24] have two tiers of benefits to consider (process and outcomes) and two beneficiaries (government and citizens) in evaluating the effectiveness of the citizen-participation process.

On the one hand, some theoretical frameworks have been published based on managerial models ^[4]. Ciasullo et al. ^[4] assess a theoretical model to examine the interactions happening between culture organizations and users that contribute to (co)-create values in the cultural domain. On the other hand, other studies offer a theoretical explanation by using microeconomic foundations ^[5]^[25]. Meade ^[5] models the impact of distributed energy resources DER on household electricity demands and investments from microeconomic principles. These models provide a theoretical explanation of DER, residual electricity demand, and prosumer welfare. Alderete ^[25] offers a theoretical framework based on some microeconomic models for the analysis of prosumerism. In the prosumerism model, the results obtained predict the abundance of the prosumer good relative to private goods. Therefore, this confirms the concept of Ritzer and Jurgenson ^[26] that prosumer capitalism online is increasingly a world of abundance.

By means of this tool, citizens could vote easily and more efficiently. This innovation has also been utilized by local and regional governments and by the Electoral Commission due to its data. WhoCanIVoteFor became a democracy tool by virtue of a team of volunteers. Moreover, since anyone is capable of downloading and utilizing the datasets, volunteers are prone to contribute or have incentives to. Moreover, the project managers used traditional media channels, social media, and a set of other organizations to promote the tool among voters. Another example is swap my vote in the UK, an online platform that matches voters across British constituencies. Most of the project managers of the e-democracy tools described before have become professionals in their projects. Hence, by participating citizens can become entrepreneurs.

Furthermore, in Romania, Harta Banilor Publici (a Public Procurement Map) provides an open-source application to raise transparency and accountability of public institutions. To this end, they provide information about how public funds are spent and show the existent procurement contracts on a map. Hence, citizens and other stakeholders such as journalists and researchers become aware of the problem. This tool was developed and implemented in-house by a team of volunteers. This democracy tool has been awarded an international grant for its impact on democracy.

Moreover, there is a smart city people-centered approach that assumes that technologies empower democracy and enhance citizens’ engagement and co-creation. Citizens are co-designers, co-creators, and co-learners with the government ^[27]. “Successful smart cities of the future will combine the best aspects of technology infrastructure while making the most of the growing potential of ‘collaborative technologies’, and above all the citizens who power them” (Saunders and Baeck 2015, cited by ^[28] (p. 11)). In this vein, citizen engagement, co-creation, and collaboration between government–academia–industry–civil society are key areas of the city’s strategy “Medellin Smart City”. For example, the co-creation platform MiMedellin.org encourages citizens’ participation through open innovation methodologies, which is led by the city council and a public entity called Ruta N.

Gamification is another recent trend to promote citizens’ participation ^[29]. In Stockholm, safe driving conduct was encouraged by connecting a speed camera to distinguish people who broke the speed limit. By obeying the rule, a person could receive a reward (some money) from a lottery collected from the defaulters. Due to this mechanism, in three days, the traffic speed was reduced by 22 percent ^[30]. This initiative suggests that entertainment and rewards could force people to adapt their behavior.

Furthermore, it is worth noting the impact of open government data and the transparency aspect in participation and collaboration in open government. There are some recent studies on open government and citizen participation ^[30]^[31]^[32]^[33]. Milic et al. ^[33] analyze the existing initiatives on data and government transparency evaluation and examine their advantages and disadvantages. With respect to government transparency, user involvement becomes a critical indicator that expresses the government’s degree of readiness to include the citizens’ perspectives. As one of the open government principles, transparency enforces the significant and productive usage of data. The more open the data are, the fewer obstacles to citizen data usage there will be. Moreover, Wirtz et al. ^[32] examine the citizens’ determining factors of open government data usage in Germany. Among the results obtained, transparency, participation, and collaboration expectancies significantly affect the citizens’ intention to use open government data. In this vein, Petrović et al. ^[31] examine the creation of value from published data. As the authors stress, one strategy to take advantage of the economic value of open government data is by making high-quality data accessible.

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1. Introduction

2. Microeconomic Explanation of Citizen Participation in Open Government

References