Most workers do not have formal contracts in developing countries. This can cause problems on both the employer and employee sides. Employees may end up being exploited by businesses that either stall or completely ignore paying their workers. Employers now have an additional layer of assurance against workers not working the contractually obliged hours, causing disruption in production and loss of profits.

Even if there are contracts detailing the above, a number of issues still remain. Firms can quite easily manipulate physical contracts. In regions with poor institutions, seeking justice and enforcement of a contract in a court of law may be very difficult, if not impossible, for most laypeople or smaller businesses.

Not only can corruption render this process highly unjust, but even if the system is functioning, the very cost of litigation means that unjust actors in the market can get away. This is generally a problem but it is particularly pertinent when there's a large power differential between two market agents, for example in some labour markets.

How can 3rd gen blockchains solve this?

Third generation blockchains such as Cardano have features such as "smart contracts". These allow users to write code that specifies a number of conditions (if statements), and consequences (then statements). This means that anything that can be digitalised can be a part of either the "if-statements" or the "then-statements". Even though the digitalisation part limits its usefulness to tasks or events that, in some way, can be digitalised and accessed on the internet, there are still many potential use-areas and ways to get around this. One can imagine a fingerprint scanner at a factory to verify the check-in and check-out times. If someone is working as a salesperson or phone-caller, then the number of calls and time spent on the calls can easily be tracked and logged. This means that the wages are automatically paid if the work has been done. Similarly, if a product has been delivered, then business A's payment will go through to business B.

About me

I'm a second year student studying the MPhil in Economics at the University of Oxford. I'm also a board member of the Oxford Society for International Development and former president of Lund Debate Society. For more information about my background please check out my LinkedIn:

https://www.linkedin.com/in/simon-s%C3%A4llstr%C3%B6m-3659b616b/

https://www.economics.ox.ac.uk/people/simon-saellstroem#/

Budget breakdown

- Finding a competent team of developers in Oxford willing to work on this project, preferably from Africa. $30/hour * 10 hours

- Writing a fully researched fund7 proposal. $30/hour * 10 hours

Definition of success:

- 3 months: have found three developers, wherein at least two of which are from Africa.

- 6 months: started development and launched a MVP

- 12 months: fully functioning dApp ready for beta-testing and pilot. Established contact with some companies willing to use it.

Public launch date Dec 1st 2022.