When Can Digital Technology Improve Governance? — The Relationship Between Trust and Digitalization

Many developing countries have set their eyes on using digital technology to enhance governance. However, I suggest that a lack of trust is an obstruction to such advancements, as it cripples the advantages of digital technology to deliver public goods and services. My central proposal is that a minimal level of trust is needed in order for digital technology to improve public goods provision. First, I contest that a minimal trust threshold must exist in order for digital technology to improve governance. Second, I aim to investigate how the prospect of political regimes may facilitate the use of digital technology for improving the provision of public goods. This study includes preliminary tests on a cross- country-level in order to highlight the central role of trust and political regimes on digitalization. First, results show that lower rates of trust, combined with increased digitalization impacts institutional quality negatively. However, this trend turns positive when levels of trust reaches beyond a certain point together with increased digitalization. Second, when levels of digitalization are low, autocracies have a more positive impact on institutional quality than democracies. However, with increased digitalization, democracies manage to take advantage of a higher level of digitalization in order to promote better provision of public goods and services. Third, increased digitalization impacts institutional quality negatively with low levels of democracy. Countries with higher levels of democracy manages to procure the positive effects of digitalization on institutional quality.