Smart contracts, transaction costs and adaptation

20 Pages Posted: 16 Nov 2018 Last revised: 3 Mar 2021

See all articles by Massimiliano Vatiero

Massimiliano Vatiero

Università della Svizzera italiana; University of Trento

Date Written: September 25, 2018


Over the last years, with the sudden and rising appeal of blockchain technology, some scholars have begun to investigate smart contracts, namely blockchain-enforced agreements. According to enthusiastic (and sometimes naïve) views, smart contracts are supposed to allow parties to conduct transactions more efficiently than traditional or semantic contracts. This paper challenges that claim. I argue that because of the need for an efficiency-enhancing adaptation of institutional arrangements—a chief problem of transaction cost economics—smart contracts may incur higher transaction costs than semantic contracts.

Keywords: Adaptation, Blockchain, Enforcement, Incomplete contracts, Smart contracts, Transaction costs

JEL Classification: D23, D86, L14, L86, O33

Suggested Citation

Vatiero, Massimiliano and Vatiero, Massimiliano, Smart contracts, transaction costs and adaptation (September 25, 2018). Available at SSRN: or

Massimiliano Vatiero (Contact Author)

University of Trento ( email )

Via Inama, 5
Trento, Trento 38122

Università della Svizzera italiana ( email )

Via Giuseppe Buffi, n. 13
Lugano, Ticino 6900

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics