"2.1.2 DAOs as platform cooperatives
Another lense through which DAOs can be viewed is platform cooperatives. Whereas platforms have been characterized as networked markets, studying Colony, Laing72 argues that DAOs should be characterized as networked programming for the division of labor rather than exchange, enabling flexible production rather than consumption, and optimizing for coordination effectiveness rather than matchmaking efficiency. As opposed to markets, firms have the ability to organize groups of people around shared purpose and learning. DAOs also show a close resemblance to worker cooperatives: 1) The economic activities are carried out primarily for the benefits of participants. 2) Most, if not all, of the capital of the organization is held by the participants colony or other DAOs investors are incentivized to participate in staking, governance as well as other productive activities – otherwise they risk dilution). 3) Often participants need to buy into the cooperative, resembling staking In many of such firms, delegated management still exists, but the board is by workers and they retain extensive informational rights.73 Worker cooperatives provide an appealing governance structure due to their positive effects on employee alignment.74 This is congruent with the view of that employees knowledge-intensive work tend to be more skeptical of hierarchical employment relations and believe that “the locus of decisions has to coincide with the locus of knowledge”.75 This is in line with agency theory, that suggests that investment in specific assets for a given project/firm/organization requires governance rights as well as rights to residual profits. This has been the argument for capital, as specific assets were long needed for production. As knowledge intensity increases, specific assets shift towards knowledgeable people as well as their data. The key difference to open source communities is that DAOs may not be limited to the private provision of public goods but may be used for the production of private goods as well. The dynamic meritocratic governance of certain DAOs, shows similarities with cooperatives that also weigh voting power by e.g. production.76 The relative transferability of a token can be compared to a partnership interest, a standard cooperative membership, or an employee share held in a trust that allow workers to diversify their risk. On the flipside, external investors can participate in the project. In terms of collective action problems, a frequent issue of worker cooperatives is time spent in meetings to reconcile differing interests. Thus, taking actions on the basis of tacit consent (freedom at the edges, humming), rather than majority voting or unanimity, may in fact be preferable.77 (see rough consensus & running code) 2.2 Governance of the infrastructure So far, we have argued that governing collective action on blockchains can be superior to other institutions. However, who is governing the governors? Are blockchains autonomous as implied in the term decentralized autonomous organizations or are still people pulling the strings? As Vitalik Buterin78 argues regarding the first DAO, Bitcoin, it is autonomous with certain imperfections in implementation. Autonomous or not, there will inevitably be unanticipated events that need to be adapted to."
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Thought some people here might be interested in reading or discussing this.
