Coalition-Based Digital Governance in the Era of AI

Dennis Snower and Paul Twomey

No 21564, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: This article argues that the governance of artificial intelligence (AI) requires a fundamental institutional redesign rather than incremental regulatory reform. Existing frameworks fail due to structural misalignment with AI’s autonomy, compositionality, and concentration dynamics. In a context where global coordination is infeasible and national regulation insufficient, the paper advances coalition-based digital governance as a second-best yet effective solution. It develops a comprehensive architecture grounded in Control–Accountability–Protection (CAP), operationalized through interoperable standards, data-control infrastructure, and coordinated enforcement. The article further proposes layered guardrails—including trade-based compliance, soft-power monitoring, and hard-power sanctions—to ensure enforceability and redress across jurisdictions.

JEL-codes: D02 D82 F55 K23 L41 L86 O33 O38 P16 (search for similar items in EconPapers)
Date: 2026-05
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