New technologies and the resulting applications have implications for the operations of governments and nonprofits. In general, AI, big data processing, blockchain, and others have the potential to have major beneficial impacts on government operations. At the same time, new technologies will require strong, sophisticated governance and management to optimize benefits and minimize risks to society.
While it may be feasible to adopt a new technology in conducting the business of governments and nonprofits, it may not necessarily be appropriate. For example, consideration should be given to exploring what functions should remain provided by humans. It is also about the ethics, morality and underlying cultural philosophy of these new digital technologies, and the broader question of the role of technology in our society.
There is some discussion in the literature of the potential effects of new technology on governments, but little discussion regarding nonprofits. While the role of nonprofits is expected to continue to change (Lobel 2003), many of the implications for government also apply to nonprofits.
Governments have adopted new technology applications to support their activities (Jefferies 2016). But new technologies will require profound changes in governments. As noted by Friedlander (2017), “…, the economic, policy, political and financial implications of technological change for state and local governments are going to be profound, and sometimes jarring.”
Governments will have to cope with the effects of the many changes that will result from the new technologies. Consider the following:
- A number of changes might affect the ability of governments to finance their operations. For example, if income distribution becomes more unequal, it may be harder for governments to finance services. Bartering might become more prevalent as transaction costs decrease, which could affect tax revenue on transactions like sales taxes. Smart sensor networks can monitor, better understand, and manage city functioning (e.g., early warning detection). Additionally, digital transactions make it challenging to capture where value is created and how to measure it, since rules for taxing physical transactions may not work with digital transactions (Jakurti 2017).
- New technology might change the optimal size of local governments and might change the best level of government (state, regional, local) that should be responsible for certain services.
- New technology could affect the transparency of government with, for example, software that makes budget and financial data and other open data easily accessible in real time, and the level of personal contact with government officials. New technology could also change the nature of citizens’ engagement in government (i.e., digital participatory decision-making).
- New technology might affect how workers are managed and increase the number working remotely.
- Governments will likely have wider responsibility for navigating an effective transition from old to new technology and for dealing with citizens who may be left behind.
- Carnoy (2000) suggests that changes caused by the new technology will require a new set of social and civic institutions to deal with the changes to families and society. This has implications for both governments and nonprofits.
- AI could change the relative importance of alternative locations for businesses. Thus, it is possible that certain types of cities or states could see a significant increase or decrease in economic activity. This has the potential for significant changes in the fiscal and economic viability of cities and states.
- There are several consequences for government from autonomous vehicles (AV).
- For example, if there is an increase in vehicle-sharing, the need for parking lots will decrease. Also, the AI used in AV could be used to impose dynamic tolling or a vehicle miles traveled tax (VMT) as a replacement for gasoline taxes.
- How will this impact public transit? What will happen to parking infrastructure? Will this shift urban development further away from urban cores?
The adoption and use of new technologies also raises technological challenges and issues. Scholars such as Schank and Hudson (2018) interviewed many people working to improve government services through technology and citizen-centered thinking to find out how it was done. They found that “no one had figured it all out.” (p.8). They do provide a roadmap for how governments can innovate.
There is need for research focused on: barriers to adopting AI technology, whether the barriers are institutional, political, or community opposition; evaluation of applications, both in terms of how well they work (e.g., makes the correct decision) and unintended consequences (e.g., makes decisions that are inequitable or discriminatory); and managing the risk associated with AI (Agrawal, Gans, and Goldfarb 2018).
Return to the Applications section of the “Identifying the Landscape of New Technologies” report.
Return to the Implications section of the “Identifying the Landscape of New Technology” report.
Proceed to the implications for Social Science and related fields.