Resolving power imbalances in construction payment using blockchain smart contracts

Abstract

<div><h3>Purpose</h3><p>This research aims to develop a blockchain smart contract–enabled framework to resolve power imbalance problems in construction payment.</p></div><div><h3>Design/methodology/approach</h3><p>This research adopts a design science research method to develop the blockchain smart contract–enabled framework. The authors then develop a prototype system. Finally, the authors evaluate its performance in solving power imbalance-induced payment problems.</p></div><div><h3>Findings</h3><p>The results show that the prototype system can resolve power imbalance problems in construction payment by allowing project participants to make transparent and decentralized decisions that are self-enforceable by blockchain smart contracts.</p></div><div><h3>Research limitations/implications</h3><p>This study provides theoretical explanations for how blockchain smart contracts can resolve power imbalances in construction payment; based on that, it proposes a novel blockchain smart contract–enabled method to rebalance the power of stakeholders in construction payment. Thus, it contributes to the body of knowledge on blockchain technology and construction payment.</p></div><div><h3>Practical implications</h3><p>This study moves beyond a conceptual framework and develops a practical blockchain smart contract system for resolving power imbalances in construction payment, strengthening construction project members' confidence in using blockchain technology.</p></div><div><h3>Social implications</h3><p>The proposed blockchain smart contract–enabled solution helps mitigate negative social impacts associated with late payment and non-payment. Furthermore, the research maximizes trust among participants in payment processes to inspire collaborative culture in the construction industry.</p></div>