\u201cThe greatest changes in history do not occur when humanity discovers\nnew technology, but when technology shifts to the centre of power.\u201d -\nBatara Maju Simatupang<\/p>\n
The history of economic development shows that every technological\nrevolution always alters the structure of economic power and the state\u2019s\ncapacity to manage development. Entering the 21st century, the world\nfaces a new phase where data, artificial intelligence (AI), machine\nlearning, and algorithms are developing into the primary infrastructure\nof the digital economy.<\/p>\n
However, the change occurring is not merely the digitalisation of\neconomic activity, but a shift in the decision-making mechanism, which\nincreasingly depends on algorithmic systems. Thus, the digital economy\ncan no longer be understood solely as a technological transformation,\nbut as a change to the architecture of power underpinning the modern\neconomic system.<\/p>\n
The urgency of this change becomes even more apparent when placed\nwithin the dynamics of the global economy. Zeberg\u2019s analysis (2026)\nindicates that the world economy is moving towards a late-cycle slowdown\nphase, marked by increasing geopolitical fragmentation, a slowdown in\ninternational trade, and a deteriorating global business cycle.<\/p>\n
Digital transformation is taking place concurrently with rising\nmacroeconomic uncertainty, making the state\u2019s ability to control the\ndigital decision-making process a crucial part of the strategy to\nmaintain national stability. In this context, Digital Financial\nSovereignty is not only a response to technological developments but\nalso to the changing strategic environment of the global economy.<\/p>\n
As explained by Frank Pasquale (2015) in The Black Box Society,\ndigital transformation not only gives birth to a data-driven economy but\nalso forms a black box society, an order where important decisions are\nincreasingly controlled by algorithms that are opaque and difficult to\nhold accountable.<\/p>\n
The popular view that data is the new oil indeed affirms the\nimportance of data as an economic asset. However, the true strategic\nvalue lies not in the data itself, but in the algorithm\u2019s ability to\ntransform data into judgement, which then produces a decision.<\/p>\n
In the digital economy, the source of power no longer stems solely\nfrom the ownership of information, but from the ability to control the\nalgorithmic mechanisms that determine how information is translated into\neconomic and social decisions.<\/p>\n
This article argues that the world is undergoing a more fundamental\nshift, from data ownership towards decision architecture. This shift\ngives rise to what is termed here as the algorithmic economy, an order\nwhere the ability to build judgement through algorithms becomes the main\nsource of economic advantage as well as a new source of state power.<\/p>\n
When algorithms determine credit risk assessments, market behaviour,\nfinancing access, and even financial system supervision, the\nrelationship between the state, the market, and society also changes.\nTherefore, digital transformation is no longer just a technological\nmodernisation project, but a transformation of the legitimacy structure\nof public decision-making.<\/p>\n
Decision Sovereignty<\/p>\n
The state fundamentally exercises its sovereignty through decisions\nthat possess legitimacy. The constitution gains meaning when it is\ntranslated into policy, regulation, and administrative action.\nTherefore, changes in how decisions are produced will ultimately affect\nhow the state exercises its sovereignty.<\/p>\n
Every decision begins with a judgement. A judge evaluates evidence\nbefore delivering a verdict. A central bank assesses macroeconomic\nconditions before setting the direction of interest rates. A regulator\nevaluates risk before establishing policy. Thus, the quality of a\ndecision never surpasses the quality of the judgement that produced\nit.<\/p>\n
The digital revolution is changing this starting point. Artificial\nIntelligence not only accelerates analysis but also shapes judgement\nthrough credit scoring, fraud detection, and machine learning. From\nPasquale\u2019s (2015) perspective, algorithms have evolved into secret\njudgements of software, systems that produce important decisions through\nprocesses increasingly closed to public scrutiny.<\/p>\n
Because of this, the state\u2019s challenge is not only to ensure the\nefficient use of AI but also to maintain that constitutional legitimacy\nremains the foundation for every decision produced through digital\ntechnology.<\/p>\n
This is where the article introduces the concept of Decision\nSovereignty. This concept does not concern the state\u2019s right to make\ndecisions, but rather the state\u2019s ability to maintain legitimacy over\ndecisions that are increasingly shaped by algorithm-based judgement\nprocesses.<\/p>\n
The main question is no longer whether AI can make decisions, but how\nthe state ensures that these decisions remain within the framework of\nthe constitution, the law, and the public interest.<\/p>\n
Institutions as the Infrastructure of Sovereignty<\/p>\n
If judgement changes, then decisions and legitimacy also change. The\nnext question is who ensures that this legitimacy endures. The answer is\nnot data or algorithms, but institutions.<\/p>\n
Institutions are the mechanisms that connect state power with the\npublic interest through a set of rules, procedures, and accountability\nmechanisms. History shows that technology almost always develops faster\nthan<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/from-technological-revolution-to-sovereignty-revolution-1785736278", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }