Bitcoin Driven Management in Organizations

Trust Building from a Behavioral Economic Perspective

Systematic Literature Review Brandenburg University of Technology Recent Study

Research Overview

Blockchain, especially Bitcoin, has been considered a revolutionizing technology in different fields, and management is no exception. This systematic literature review examines how blockchain-based management fosters trust building with organizational behavior economics. The study systematizes mainstream studies on blockchain technology and its mechanisms, emphasizing smart contracts and empirical evidence on driving trust, honesty, and accountability.

The review addresses challenges and opportunities for adopting blockchain in organizational settings using the PRISMA protocol to identify critical enablers of blockchain adoption in the context of organizational trust building.

Research Questions

RQ1: Trust-Building Mechanisms

What mechanisms of blockchain technology (e.g., decentralization, transparency, smart contracts) influence trust-building in organizational management, and how are these mechanisms empirically validated?

RQ2: Smart Contracts Role

How do smart contracts enhance accountability and transparency, and how do these features contribute to organizational trust?

RQ3: Behavioral Economic Principles

How do behavioral economic principles (e.g., loss aversion, status quo bias, and trust) interact with blockchain-driven management systems to enhance or hinder trust in organizational settings?

RQ4: Empirical Evidence

What empirical evidence supports the claims that blockchain technology can enhance trust, honesty, and accountability in organizational management?

Methodology

This study employs a systematic literature review approach following the PRISMA protocol to ensure rigorous and comprehensive examination of relevant literature. The methodology includes:

Search Strategy

Comprehensive search across Web of Science Core Collection, EBSCO, and Google Scholar using systematic search strings combining blockchain, trust, and organizational management terms.

Inclusion Criteria

Studies published until December 31, 2022, in English, focusing on blockchain technology in organizational management, trust-building, behavioral economics, transparency, or accountability.

Quality Assessment

Standardized checklist focusing on study design, methodology, and relevance to research questions, with thematic synthesis of findings.

Data Extraction

Key information captured including study objectives, methodology, findings related to blockchain and trust-building, and challenges associated with blockchain adoption.

Key Blockchain Trust Mechanisms

Decentralization

Enhances perceived fairness and reduces risk of manipulation through distributed control across multiple nodes (Social Proof, Status Quo Bias).

Transparency

Full visibility of transactions and processes reduces uncertainty and builds confidence (Trust and Verification, Loss Aversion).

Immutability

Ensures data integrity and prevents fraud, providing consistency and reliability (Endowment Effect).

Smart Contracts

Automated and enforceable digital agreements reduce need for intermediaries and ensure predictable execution (Automation and Trust).

Consensus Mechanisms

Multiple parties validate transactions, enhancing security and fairness (Collective Decision-Making, Trust in Technology).

Security

Strong cryptographic techniques protect against fraud and unauthorized access (Risk Perception, Reputation and Reliability).

Challenges and Opportunities

Implementation Challenges

  • Decentralization Paradox: Different blockchain networks show varying degrees of centralization, affecting trust levels
  • Technical Barriers: Scalability and energy consumption issues, particularly with Bitcoin's Proof of Work mechanism
  • Ethical Considerations: Use of behavioral economic insights for network design raises questions about manipulation and power distribution
  • Regulatory Uncertainty: Lack of clear frameworks for blockchain implementation in organizational settings

Strategic Opportunities

  • Trust Enhancement: Significant potential for improving organizational transparency and stakeholder confidence
  • Process Automation: Smart contracts can reduce intermediaries and ensure predictable execution of agreements
  • Governance Innovation: Decentralized Autonomous Organizations (DAOs) offer new models for organizational decision-making
  • Behavioral Integration: Understanding psychological factors can improve blockchain adoption strategies

Future Research Directions

AI-Generated DAOs

Investigation of how artificial intelligence might create and manage decentralized autonomous organizations, eliminating human bias while raising new questions about algorithmic governance.

Cross-Cultural Trust Mechanisms

Exploration of how cultural differences affect trust perception in blockchain systems and the need for culturally adaptive implementation strategies.

Regulatory Framework Development

Development of evidence-based policy recommendations for blockchain regulation that balance innovation with consumer protection and ethical considerations.

Long-term Behavioral Impact

Longitudinal studies to understand how prolonged exposure to blockchain systems affects organizational behavior and trust dynamics over time.

Research Collaboration

Interested in discussing this research or potential collaborations?

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