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The purpose of this paper is to analyze the creation of the flex-fuel technology under the perspective of Economy Transaction Cost (ECT). To achieve this purpose, the main actors involved in the technology development were interviewed, articulating four analytic categories to identify how ECT is structured in the flex-fuel technology: bounded rationality; frequency transaction; asset specificity; and opportunism. We conclude that the automakers had the capacity to elaborate contracts mixing hybrid relationships between markets and hierarchies. The main contribution of this paper consists of the analysis of transaction costs in the flex-fuel technology development, a fact not widely studied in Brazil