The Impact of AI Applications on Smart Decision-Making in Smart Cities: The Mediating Roles of the Internet of Things and Smart Governance

Smart cities increasingly depend on digital technologies to manage urban services, use resources efficiently, and respond to the changing needs of citizens. Artificial intelligence (AI) can help city authorities analyse complex information, predict future conditions, and make informed decisions. However, the success of AI-based systems depends on more than their analytical capabilities. They also require reliable data from the Internet of Things (IoT) and governance practices that ensure transparency, accountability, and responsible use of technology. This paper examines how AI applications may influence smart decision-making in smart cities, with particular attention to the mediating roles of IoT integration and smart governance. Recent research published between 2024 and 2026 is reviewed to understand developments in AI-enabled urban services, connected infrastructure, and responsible digital governance. Based on this review, an integrated conceptual framework is proposed to explain the relationships among AI applications, IoT integration, smart governance, and decision-making outcomes. The framework considers decision accuracy, responsiveness, transparency, and resource efficiency as important dimensions of effective urban decision-making. It also highlights challenges related to data quality, privacy, cybersecurity, algorithmic bias, and public trust. Eight research hypotheses and a quantitative research methodology are proposed for future empirical investigation. The paper contributes a structured basis for examining how technological capabilities and governance arrangements may work together to support better urban decisions. The proposed relationships require validation through data collection and statistical analysis