Relational Capital and Blockchain: Can Smart Contracts Redefine the Nature of Inter-organisational Cooperation?

The relational viewposits that the relational capital derived from the social network processmay facilitate the achievement of organisational strategic objectives in inter-organisational cooperation (Liu et al. in Journal of World Business 45:237–249, 2010). However, scholarly literature and business media are rife with examples of inter-organisational cooperation hindering the accomplishment of management goals (Brache and Felzensztein in International Business Review 28:25–35, 2019), with over fifty percent of alliances failing to meet their initial objectives (Kaplan et al. in Harvard Business Review 88:114–120, 2010). Blockchain technology introduces the opportunity to create, operate, and effectively regulate decentralized autonomous organisations (DAOs) with functions that include ownership, governance, decision-making, and profit distribution (Sims in New Zealand Universities Law Review 28:423–458, 2019). Smart contracts in the blockchain could serve as an automaton to efficiently modify cooperation behaviours, thus improving the potential for successful cooperation. Using a game theory approach to formulate a series of propositions, this study explores how smart contracts and blockchain technology help develop and manage relational capital. As a theoretical contribution, this chapter explains how smart contracts solve the natural frictions that arise in collaborative projects and offers a set of recommendations for policymakers and practitioners looking to engage in inter-organisational cooperation using smart contracts as a mediating tool.