Decentralized Autonomous Organizations: Strategic Implications and Applications for the Public Sector

This thesis examines Decentralized Autonomous Organizations (DAOs) as an innovative governance model with particular emphasis on their potential adoption in the public sector. Drawing on organizational theory, innovation management, and blockchain governance literature, the study analyzes how DAOs can reshape institutional arrangements, collective decision-making, and the delivery of public goods. The research first outlines the fundamentals of DAOs, including their technical infrastructure, governance mechanisms, and incentive structures. It then investigates civic and public-oriented DAOs such as Gitcoin, CityDAO, UkraineDAO, and other initiatives that experiment with decentralized models for community engagement, funding, and governance. Comparative case studies highlight both success and failure factors, emphasizing the trade-offs between decentralization, efficiency, inclusivity, and legitimacy. Findings suggest that DAOs hold promise in enhancing transparency, accountability, and citizen participation, while also facing critical challenges related to scalability, legal uncertainty, digital divides, and risks of governance capture. By exploring the strategic and operational implications of DAOs in public governance, the thesis contributes to understanding how this organizational innovation may serve as a building block for more participatory, resilient, and adaptive public institutions.