diff --git a/libsolidity/AST.cpp b/libsolidity/AST.cpp
index 107482d03..d14cbf5c6 100644
--- a/libsolidity/AST.cpp
+++ b/libsolidity/AST.cpp
@@ -173,7 +173,15 @@ void VariableDefinition::checkTypeRequirements()
 		{
 			// no type declared and no previous assignment, infer the type
 			m_value->checkTypeRequirements();
-			m_variable->setType(m_value->getType());
+			TypePointer type = m_value->getType();
+			if (type->getCategory() == Type::Category::INTEGER_CONSTANT)
+			{
+				auto intType = dynamic_pointer_cast<IntegerConstantType const>(type)->getIntegerType();
+				if (!intType)
+					BOOST_THROW_EXCEPTION(m_value->createTypeError("Invalid integer constant " + type->toString()));
+				type = intType;
+			}
+			m_variable->setType(type);
 		}
 	}
 }
@@ -195,13 +203,19 @@ void Assignment::checkTypeRequirements()
 		TypePointer resultType = m_type->binaryOperatorResult(Token::AssignmentToBinaryOp(m_assigmentOperator),
 															  m_rightHandSide->getType());
 		if (!resultType || *resultType != *m_type)
-			BOOST_THROW_EXCEPTION(createTypeError("Operator not compatible with type."));
+			BOOST_THROW_EXCEPTION(createTypeError("Operator " + string(Token::toString(m_assigmentOperator)) +
+												  " not compatible with types " +
+												  m_type->toString() + " and " +
+												  m_rightHandSide->getType()->toString()));
 	}
 }
 
 void ExpressionStatement::checkTypeRequirements()
 {
 	m_expression->checkTypeRequirements();
+	if (m_expression->getType()->getCategory() == Type::Category::INTEGER_CONSTANT)
+		if (!dynamic_pointer_cast<IntegerConstantType const>(m_expression->getType())->getIntegerType())
+			BOOST_THROW_EXCEPTION(m_expression->createTypeError("Invalid integer constant."));
 }
 
 void Expression::expectType(Type const& _expectedType)
@@ -387,7 +401,7 @@ void Literal::checkTypeRequirements()
 {
 	m_type = Type::forLiteral(*this);
 	if (!m_type)
-		BOOST_THROW_EXCEPTION(createTypeError("Literal value too large."));
+		BOOST_THROW_EXCEPTION(createTypeError("Invalid literal value."));
 }
 
 }
diff --git a/libsolidity/ExpressionCompiler.cpp b/libsolidity/ExpressionCompiler.cpp
index aa7406132..9ea4c28a3 100644
--- a/libsolidity/ExpressionCompiler.cpp
+++ b/libsolidity/ExpressionCompiler.cpp
@@ -71,12 +71,20 @@ bool ExpressionCompiler::visit(Assignment const& _assignment)
 	return false;
 }
 
-void ExpressionCompiler::endVisit(UnaryOperation const& _unaryOperation)
+bool ExpressionCompiler::visit(UnaryOperation const& _unaryOperation)
 {
 	//@todo type checking and creating code for an operator should be in the same place:
 	// the operator should know how to convert itself and to which types it applies, so
 	// put this code together with "Type::acceptsBinary/UnaryOperator" into a class that
 	// represents the operator
+	if (_unaryOperation.getType()->getCategory() == Type::Category::INTEGER_CONSTANT)
+	{
+		m_context << _unaryOperation.getType()->literalValue(nullptr);
+		return false;
+	}
+
+	_unaryOperation.getSubExpression().accept(*this);
+
 	switch (_unaryOperation.getOperator())
 	{
 	case Token::NOT: // !
@@ -128,6 +136,7 @@ void ExpressionCompiler::endVisit(UnaryOperation const& _unaryOperation)
 		BOOST_THROW_EXCEPTION(InternalCompilerError() << errinfo_comment("Invalid unary operator: " +
 																		 string(Token::toString(_unaryOperation.getOperator()))));
 	}
+	return false;
 }
 
 bool ExpressionCompiler::visit(BinaryOperation const& _binaryOperation)
@@ -139,17 +148,19 @@ bool ExpressionCompiler::visit(BinaryOperation const& _binaryOperation)
 
 	if (op == Token::AND || op == Token::OR) // special case: short-circuiting
 		appendAndOrOperatorCode(_binaryOperation);
+	else if (commonType.getCategory() == Type::Category::INTEGER_CONSTANT)
+		m_context << commonType.literalValue(nullptr);
 	else
 	{
-		bool cleanupNeeded = false;
-		if (commonType.getCategory() == Type::Category::INTEGER)
-			if (Token::isCompareOp(op) || op == Token::DIV || op == Token::MOD)
-				cleanupNeeded = true;
+		bool cleanupNeeded = commonType.getCategory() == Type::Category::INTEGER &&
+								(Token::isCompareOp(op) || op == Token::DIV || op == Token::MOD);
 
 		// for commutative operators, push the literal as late as possible to allow improved optimization
-		//@todo this has to be extended for literal expressions
-		bool swap = (m_optimize && Token::isCommutativeOp(op) && dynamic_cast<Literal const*>(&rightExpression)
-					 && !dynamic_cast<Literal const*>(&leftExpression));
+		auto isLiteral = [](Expression const& _e)
+		{
+			return dynamic_cast<Literal const*>(&_e) || _e.getType()->getCategory() == Type::Category::INTEGER_CONSTANT;
+		};
+		bool swap = m_optimize && Token::isCommutativeOp(op) && isLiteral(rightExpression) && !isLiteral(leftExpression);
 		if (swap)
 		{
 			leftExpression.accept(*this);
@@ -423,10 +434,10 @@ void ExpressionCompiler::endVisit(Literal const& _literal)
 {
 	switch (_literal.getType()->getCategory())
 	{
-	case Type::Category::INTEGER:
+	case Type::Category::INTEGER_CONSTANT:
 	case Type::Category::BOOL:
 	case Type::Category::STRING:
-		m_context << _literal.getType()->literalValue(_literal);
+		m_context << _literal.getType()->literalValue(&_literal);
 		break;
 	default:
 		BOOST_THROW_EXCEPTION(InternalCompilerError() << errinfo_comment("Only integer, boolean and string literals implemented for now."));
@@ -562,9 +573,16 @@ void ExpressionCompiler::appendTypeConversion(Type const& _typeOnStack, Type con
 
 	if (_typeOnStack == _targetType && !_cleanupNeeded)
 		return;
-	if (_typeOnStack.getCategory() == Type::Category::INTEGER)
+	Type::Category stackTypeCategory = _typeOnStack.getCategory();
+	Type::Category targetTypeCategory = _targetType.getCategory();
+	if (stackTypeCategory == Type::Category::INTEGER)
+	{
+		solAssert(targetTypeCategory == Type::Category::INTEGER || targetTypeCategory == Type::Category::CONTRACT, "");
 		appendHighBitsCleanup(dynamic_cast<IntegerType const&>(_typeOnStack));
-	else if (_typeOnStack.getCategory() == Type::Category::STRING)
+	}
+	else if (stackTypeCategory == Type::Category::INTEGER_CONSTANT)
+		solAssert(targetTypeCategory == Type::Category::INTEGER || targetTypeCategory == Type::Category::CONTRACT, "");
+	else if (stackTypeCategory == Type::Category::STRING)
 	{
 		// nothing to do, strings are high-order-bit-aligned
 		//@todo clear lower-order bytes if we allow explicit conversion to shorter strings
diff --git a/libsolidity/ExpressionCompiler.h b/libsolidity/ExpressionCompiler.h
index c0ee4ab48..c021aaff4 100644
--- a/libsolidity/ExpressionCompiler.h
+++ b/libsolidity/ExpressionCompiler.h
@@ -57,7 +57,7 @@ private:
 		m_optimize(_optimize), m_context(_compilerContext), m_currentLValue(m_context) {}
 
 	virtual bool visit(Assignment const& _assignment) override;
-	virtual void endVisit(UnaryOperation const& _unaryOperation) override;
+	virtual bool visit(UnaryOperation const& _unaryOperation) override;
 	virtual bool visit(BinaryOperation const& _binaryOperation) override;
 	virtual bool visit(FunctionCall const& _functionCall) override;
 	virtual bool visit(NewExpression const& _newExpression) override;
diff --git a/libsolidity/Scanner.cpp b/libsolidity/Scanner.cpp
index 6433b5262..6e3d04bc5 100644
--- a/libsolidity/Scanner.cpp
+++ b/libsolidity/Scanner.cpp
@@ -455,7 +455,7 @@ void Scanner::scanToken()
 				token = Token::ADD;
 			break;
 		case '-':
-			// - -- -= Number
+			// - -- -=
 			advance();
 			if (m_char == '-')
 			{
@@ -464,8 +464,6 @@ void Scanner::scanToken()
 			}
 			else if (m_char == '=')
 				token = selectToken(Token::ASSIGN_SUB);
-			else if (m_char == '.' || isDecimalDigit(m_char))
-				token = scanNumber('-');
 			else
 				token = Token::SUB;
 			break;
@@ -650,8 +648,7 @@ Token::Value Scanner::scanNumber(char _charSeen)
 	}
 	else
 	{
-		if (_charSeen == '-')
-			addLiteralChar('-');
+		solAssert(_charSeen == 0, "");
 		// if the first character is '0' we must check for octals and hex
 		if (m_char == '0')
 		{
diff --git a/libsolidity/Types.cpp b/libsolidity/Types.cpp
index 1e6936e61..c29b98753 100644
--- a/libsolidity/Types.cpp
+++ b/libsolidity/Types.cpp
@@ -91,7 +91,7 @@ shared_ptr<Type const> Type::forLiteral(Literal const& _literal)
 	case Token::FALSE_LITERAL:
 		return make_shared<BoolType const>();
 	case Token::NUMBER:
-		return IntegerType::smallestTypeForLiteral(_literal.getValue());
+		return IntegerConstantType::fromLiteral(_literal.getValue());
 	case Token::STRING_LITERAL:
 		//@todo put larger strings into dynamic strings
 		return StaticStringType::smallestTypeForLiteral(_literal.getValue());
@@ -112,19 +112,6 @@ TypePointer Type::commonType(TypePointer const& _a, TypePointer const& _b)
 
 const MemberList Type::EmptyMemberList = MemberList();
 
-shared_ptr<IntegerType const> IntegerType::smallestTypeForLiteral(string const& _literal)
-{
-	bigint value(_literal);
-	bool isSigned = value < 0 || (!_literal.empty() && _literal.front() == '-');
-	if (isSigned)
-		// convert to positive number of same bit requirements
-		value = ((-value) - 1) << 1;
-	unsigned bytes = max(bytesRequired(value), 1u);
-	if (bytes > 32)
-		return shared_ptr<IntegerType const>();
-	return make_shared<IntegerType const>(bytes * 8, isSigned ? Modifier::SIGNED : Modifier::UNSIGNED);
-}
-
 IntegerType::IntegerType(int _bits, IntegerType::Modifier _modifier):
 	m_bits(_bits), m_modifier(_modifier)
 {
@@ -194,15 +181,9 @@ string IntegerType::toString() const
 	return prefix + dev::toString(m_bits);
 }
 
-u256 IntegerType::literalValue(Literal const& _literal) const
-{
-	bigint value(_literal.getValue());
-	return u256(value);
-}
-
 TypePointer IntegerType::binaryOperatorResult(Token::Value _operator, TypePointer const& _other) const
 {
-	if (getCategory() != _other->getCategory())
+	if (_other->getCategory() != Category::INTEGER_CONSTANT && _other->getCategory() != getCategory())
 		return TypePointer();
 	auto commonType = dynamic_pointer_cast<IntegerType const>(Type::commonType(shared_from_this(), _other));
 
@@ -236,6 +217,141 @@ const MemberList IntegerType::AddressMemberList =
 					make_shared<FunctionType const>(TypePointers({make_shared<IntegerType const>(256)}),
 													TypePointers(), FunctionType::Location::SEND)}});
 
+shared_ptr<IntegerConstantType const> IntegerConstantType::fromLiteral(string const& _literal)
+{
+	return make_shared<IntegerConstantType const>(bigint(_literal));
+}
+
+bool IntegerConstantType::isImplicitlyConvertibleTo(Type const& _convertTo) const
+{
+	TypePointer integerType = getIntegerType();
+	return integerType && integerType->isImplicitlyConvertibleTo(_convertTo);
+}
+
+bool IntegerConstantType::isExplicitlyConvertibleTo(Type const& _convertTo) const
+{
+	TypePointer integerType = getIntegerType();
+	return integerType && integerType->isExplicitlyConvertibleTo(_convertTo);
+}
+
+TypePointer IntegerConstantType::unaryOperatorResult(Token::Value _operator) const
+{
+	bigint value;
+	switch (_operator)
+	{
+	case Token::BIT_NOT:
+		value = ~m_value;
+		break;
+	case Token::ADD:
+		value = m_value;
+		break;
+	case Token::SUB:
+		value = -m_value;
+		break;
+	default:
+		return TypePointer();
+	}
+	return make_shared<IntegerConstantType const>(value);
+}
+
+TypePointer IntegerConstantType::binaryOperatorResult(Token::Value _operator, TypePointer const& _other) const
+{
+	if (_other->getCategory() == Category::INTEGER)
+	{
+		shared_ptr<IntegerType const> integerType = getIntegerType();
+		if (!integerType)
+			return TypePointer();
+		return integerType->binaryOperatorResult(_operator, _other);
+	}
+	else if (_other->getCategory() != getCategory())
+		return TypePointer();
+
+	IntegerConstantType const& other = dynamic_cast<IntegerConstantType const&>(*_other);
+	if (Token::isCompareOp(_operator))
+	{
+		shared_ptr<IntegerType const> thisIntegerType = getIntegerType();
+		shared_ptr<IntegerType const> otherIntegerType = other.getIntegerType();
+		if (!thisIntegerType || !otherIntegerType)
+			return TypePointer();
+		return thisIntegerType->binaryOperatorResult(_operator, otherIntegerType);
+	}
+	else
+	{
+		bigint value;
+		switch (_operator)
+		{
+		case Token::BIT_OR:
+			value = m_value | other.m_value;
+			break;
+		case Token::BIT_XOR:
+			value = m_value ^ other.m_value;
+			break;
+		case Token::BIT_AND:
+			value = m_value & other.m_value;
+			break;
+		case Token::ADD:
+			value = m_value + other.m_value;
+			break;
+		case Token::SUB:
+			value = m_value - other.m_value;
+			break;
+		case Token::MUL:
+			value = m_value * other.m_value;
+			break;
+		case Token::DIV:
+			if (other.m_value == 0)
+				return TypePointer();
+			value = m_value / other.m_value;
+			break;
+		case Token::MOD:
+			if (other.m_value == 0)
+				return TypePointer();
+			value = m_value % other.m_value;
+			break;
+		default:
+			return TypePointer();
+		}
+		return make_shared<IntegerConstantType const>(value);
+	}
+}
+
+bool IntegerConstantType::operator==(Type const& _other) const
+{
+	if (_other.getCategory() != getCategory())
+		return false;
+	return m_value == dynamic_cast<IntegerConstantType const&>(_other).m_value;
+}
+
+string IntegerConstantType::toString() const
+{
+	return "int_const " + m_value.str();
+}
+
+u256 IntegerConstantType::literalValue(Literal const*) const
+{
+	// we ignore the literal and hope that the type was correctly determined
+	solAssert(m_value <= u256(-1), "Integer constant too large.");
+	solAssert(m_value >= -(bigint(1) << 255), "Integer constant too small.");
+	if (m_value >= 0)
+		return u256(m_value);
+	else
+		return s2u(s256(m_value));
+}
+
+shared_ptr<IntegerType const> IntegerConstantType::getIntegerType() const
+{
+	bigint value = m_value;
+	bool negative = (value < 0);
+	if (negative) // convert to positive number of same bit requirements
+		value = ((-value) - 1) << 1;
+	if (value > u256(-1))
+		return shared_ptr<IntegerType const>();
+	else
+		return make_shared<IntegerType const>(max(bytesRequired(value), 1u) * 8,
+											  negative ? IntegerType::Modifier::SIGNED
+													   : IntegerType::Modifier::UNSIGNED);
+}
+
 shared_ptr<StaticStringType> StaticStringType::smallestTypeForLiteral(string const& _literal)
 {
 	if (_literal.length() <= 32)
@@ -265,12 +381,13 @@ bool StaticStringType::operator==(Type const& _other) const
 	return other.m_bytes == m_bytes;
 }
 
-u256 StaticStringType::literalValue(const Literal& _literal) const
+u256 StaticStringType::literalValue(const Literal* _literal) const
 {
+	solAssert(_literal, "");
 	u256 value = 0;
-	for (char c: _literal.getValue())
+	for (char c: _literal->getValue())
 		value = (value << 8) | byte(c);
-	return value << ((32 - _literal.getValue().length()) * 8);
+	return value << ((32 - _literal->getValue().length()) * 8);
 }
 
 bool BoolType::isExplicitlyConvertibleTo(Type const& _convertTo) const
@@ -286,11 +403,12 @@ bool BoolType::isExplicitlyConvertibleTo(Type const& _convertTo) const
 	return isImplicitlyConvertibleTo(_convertTo);
 }
 
-u256 BoolType::literalValue(Literal const& _literal) const
+u256 BoolType::literalValue(Literal const* _literal) const
 {
-	if (_literal.getToken() == Token::TRUE_LITERAL)
+	solAssert(_literal, "");
+	if (_literal->getToken() == Token::TRUE_LITERAL)
 		return u256(1);
-	else if (_literal.getToken() == Token::FALSE_LITERAL)
+	else if (_literal->getToken() == Token::FALSE_LITERAL)
 		return u256(0);
 	else
 		BOOST_THROW_EXCEPTION(InternalCompilerError() << errinfo_comment("Bool type constructed from non-boolean literal."));
diff --git a/libsolidity/Types.h b/libsolidity/Types.h
index 35987be08..918a915cc 100644
--- a/libsolidity/Types.h
+++ b/libsolidity/Types.h
@@ -75,7 +75,7 @@ class Type: private boost::noncopyable, public std::enable_shared_from_this<Type
 public:
 	enum class Category
 	{
-		INTEGER, BOOL, REAL, STRING, CONTRACT, STRUCT, FUNCTION, MAPPING, VOID, TYPE, MAGIC
+		INTEGER, INTEGER_CONSTANT, BOOL, REAL, STRING, CONTRACT, STRUCT, FUNCTION, MAPPING, VOID, TYPE, MAGIC
 	};
 
 	///@{
@@ -135,7 +135,7 @@ public:
 	TypePointer getMemberType(std::string const& _name) const { return getMembers().getMemberType(_name); }
 
 	virtual std::string toString() const = 0;
-	virtual u256 literalValue(Literal const&) const
+	virtual u256 literalValue(Literal const*) const
 	{
 		BOOST_THROW_EXCEPTION(InternalCompilerError() << errinfo_comment("Literal value requested "
 																		  "for type without literals."));
@@ -158,10 +158,6 @@ public:
 	};
 	virtual Category getCategory() const override { return Category::INTEGER; }
 
-	/// @returns the smallest integer type for the given literal or an empty pointer
-	/// if no type fits.
-	static std::shared_ptr<IntegerType const> smallestTypeForLiteral(std::string const& _literal);
-
 	explicit IntegerType(int _bits, Modifier _modifier = Modifier::UNSIGNED);
 
 	virtual bool isImplicitlyConvertibleTo(Type const& _convertTo) const override;
@@ -177,7 +173,6 @@ public:
 	virtual MemberList const& getMembers() const { return isAddress() ? AddressMemberList : EmptyMemberList; }
 
 	virtual std::string toString() const override;
-	virtual u256 literalValue(Literal const& _literal) const override;
 
 	int getNumBits() const { return m_bits; }
 	bool isHash() const { return m_modifier == Modifier::HASH || m_modifier == Modifier::ADDRESS; }
@@ -190,6 +185,40 @@ private:
 	static const MemberList AddressMemberList;
 };
 
+/**
+ * Integer constants either literals or computed. Example expressions: 2, 2+10, ~10.
+ * There is one distinct type per value.
+ */
+class IntegerConstantType: public Type
+{
+public:
+	virtual Category getCategory() const override { return Category::INTEGER_CONSTANT; }
+
+	static std::shared_ptr<IntegerConstantType const> fromLiteral(std::string const& _literal);
+
+	explicit IntegerConstantType(bigint _value): m_value(_value) {}
+
+	virtual bool isImplicitlyConvertibleTo(Type const& _convertTo) const override;
+	virtual bool isExplicitlyConvertibleTo(Type const& _convertTo) const override;
+	virtual TypePointer unaryOperatorResult(Token::Value _operator) const override;
+	virtual TypePointer binaryOperatorResult(Token::Value _operator, TypePointer const& _other) const override;
+
+	virtual bool operator==(Type const& _other) const override;
+
+	virtual bool canBeStored() const override { return false; }
+	virtual bool canLiveOutsideStorage() const override { return false; }
+	virtual unsigned getSizeOnStack() const override { return 1; }
+
+	virtual std::string toString() const override;
+	virtual u256 literalValue(Literal const* _literal) const override;
+
+	/// @returns the smallest integer type that can hold the value or an empty pointer if not possible.
+	std::shared_ptr<IntegerType const> getIntegerType() const;
+
+private:
+	bigint m_value;
+};
+
 /**
  * String type with fixed length, up to 32 bytes.
  */
@@ -211,7 +240,7 @@ public:
 	virtual bool isValueType() const override { return true; }
 
 	virtual std::string toString() const override { return "string" + dev::toString(m_bytes); }
-	virtual u256 literalValue(Literal const& _literal) const override;
+	virtual u256 literalValue(Literal const* _literal) const override;
 
 	int getNumBytes() const { return m_bytes; }
 
@@ -238,7 +267,7 @@ public:
 	virtual bool isValueType() const override { return true; }
 
 	virtual std::string toString() const override { return "bool"; }
-	virtual u256 literalValue(Literal const& _literal) const override;
+	virtual u256 literalValue(Literal const* _literal) const override;
 };
 
 /**
diff --git a/test/SolidityCompiler.cpp b/test/SolidityCompiler.cpp
index 385a3e577..2345db64a 100644
--- a/test/SolidityCompiler.cpp
+++ b/test/SolidityCompiler.cpp
@@ -135,10 +135,10 @@ BOOST_AUTO_TEST_CASE(different_argument_numbers)
 					   byte(Instruction::JUMPDEST), // beginning of g
 					   byte(Instruction::PUSH1), 0x0,
 					   byte(Instruction::PUSH1), 0x0, // initialized e and h
-					   byte(Instruction::PUSH1), byte(0x2a + shift), // ret address
-					   byte(Instruction::PUSH1), 0x1, byte(Instruction::PUSH1), 0xff, byte(Instruction::AND),
-					   byte(Instruction::PUSH1), 0x2, byte(Instruction::PUSH1), 0xff, byte(Instruction::AND),
-					   byte(Instruction::PUSH1), 0x3, byte(Instruction::PUSH1), 0xff, byte(Instruction::AND),
+					   byte(Instruction::PUSH1), byte(0x21 + shift), // ret address
+					   byte(Instruction::PUSH1), 0x1,
+					   byte(Instruction::PUSH1), 0x2,
+					   byte(Instruction::PUSH1), 0x3,
 					   byte(Instruction::PUSH1), byte(0x1 + shift),
 					   // stack here: ret e h 0x20 1 2 3 0x1
 					   byte(Instruction::JUMP),
diff --git a/test/SolidityExpressionCompiler.cpp b/test/SolidityExpressionCompiler.cpp
index 9c375418e..579af5bb9 100644
--- a/test/SolidityExpressionCompiler.cpp
+++ b/test/SolidityExpressionCompiler.cpp
@@ -174,8 +174,8 @@ BOOST_AUTO_TEST_CASE(comparison)
 	bytes code = compileFirstExpression(sourceCode);
 
 	bytes expectation({byte(eth::Instruction::PUSH1), 0x1,
-					   byte(eth::Instruction::PUSH2), 0x11, 0xaa, byte(eth::Instruction::PUSH2), 0xff, 0xff, byte(eth::Instruction::AND),
-					   byte(eth::Instruction::PUSH2), 0x10, 0xaa, byte(eth::Instruction::PUSH2), 0xff, 0xff, byte(eth::Instruction::AND),
+					   byte(eth::Instruction::PUSH2), 0x11, 0xaa,
+					   byte(eth::Instruction::PUSH2), 0x10, 0xaa,
 					   byte(eth::Instruction::LT),
 					   byte(eth::Instruction::EQ),
 					   byte(eth::Instruction::ISZERO)});
@@ -189,20 +189,18 @@ BOOST_AUTO_TEST_CASE(short_circuiting)
 							 "}\n";
 	bytes code = compileFirstExpression(sourceCode);
 
-	bytes expectation({byte(eth::Instruction::PUSH1), 0xa,
-					   byte(eth::Instruction::PUSH1), 0x8,
-					   byte(eth::Instruction::ADD), byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
-					   byte(eth::Instruction::PUSH1), 0x4, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
+	bytes expectation({byte(eth::Instruction::PUSH1), 0x12, // 8 + 10
+					   byte(eth::Instruction::PUSH1), 0x4,
 					   byte(eth::Instruction::GT),
-					   byte(eth::Instruction::ISZERO), // after this we have 10 + 8 >= 4
+					   byte(eth::Instruction::ISZERO), // after this we have 4 <= 8 + 10
 					   byte(eth::Instruction::DUP1),
-					   byte(eth::Instruction::PUSH1), 0x20,
+					   byte(eth::Instruction::PUSH1), 0x11,
 					   byte(eth::Instruction::JUMPI), // short-circuit if it is true
 					   byte(eth::Instruction::POP),
-					   byte(eth::Instruction::PUSH1), 0x2, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
-					   byte(eth::Instruction::PUSH1), 0x9, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
+					   byte(eth::Instruction::PUSH1), 0x2,
+					   byte(eth::Instruction::PUSH1), 0x9,
 					   byte(eth::Instruction::EQ),
-					   byte(eth::Instruction::ISZERO), // after this we have 2 != 9
+					   byte(eth::Instruction::ISZERO), // after this we have 9 != 2
 					   byte(eth::Instruction::JUMPDEST),
 					   byte(eth::Instruction::PUSH1), 0x1,
 					   byte(eth::Instruction::EQ),
@@ -213,28 +211,24 @@ BOOST_AUTO_TEST_CASE(short_circuiting)
 BOOST_AUTO_TEST_CASE(arithmetics)
 {
 	char const* sourceCode = "contract test {\n"
-							 "  function f() { var x = ((((((((9 ^ 8) & 7) | 6) - 5) + 4) % 3) / 2) * 1); }"
+							 "  function f(uint y) { var x = ((((((((y ^ 8) & 7) | 6) - 5) + 4) % 3) / 2) * 1); }"
 							 "}\n";
-	bytes code = compileFirstExpression(sourceCode);
+	bytes code = compileFirstExpression(sourceCode, {}, {{"test", "f", "y"}, {"test", "f", "x"}});
 	bytes expectation({byte(eth::Instruction::PUSH1), 0x1,
 					   byte(eth::Instruction::PUSH1), 0x2,
-					   byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
 					   byte(eth::Instruction::PUSH1), 0x3,
-					   byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
 					   byte(eth::Instruction::PUSH1), 0x4,
 					   byte(eth::Instruction::PUSH1), 0x5,
 					   byte(eth::Instruction::PUSH1), 0x6,
 					   byte(eth::Instruction::PUSH1), 0x7,
 					   byte(eth::Instruction::PUSH1), 0x8,
-					   byte(eth::Instruction::PUSH1), 0x9,
+					   byte(eth::Instruction::DUP10),
 					   byte(eth::Instruction::XOR),
 					   byte(eth::Instruction::AND),
 					   byte(eth::Instruction::OR),
 					   byte(eth::Instruction::SUB),
 					   byte(eth::Instruction::ADD),
-					   byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
 					   byte(eth::Instruction::MOD),
-					   byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
 					   byte(eth::Instruction::DIV),
 					   byte(eth::Instruction::MUL)});
 	BOOST_CHECK_EQUAL_COLLECTIONS(code.begin(), code.end(), expectation.begin(), expectation.end());
@@ -243,15 +237,15 @@ BOOST_AUTO_TEST_CASE(arithmetics)
 BOOST_AUTO_TEST_CASE(unary_operators)
 {
 	char const* sourceCode = "contract test {\n"
-							 "  function f() { var x = !(~+- 1 == 2); }"
+							 "  function f(int y) { var x = !(~+- y == 2); }"
 							 "}\n";
-	bytes code = compileFirstExpression(sourceCode);
+	bytes code = compileFirstExpression(sourceCode, {}, {{"test", "f", "y"}, {"test", "f", "x"}});
 
-	bytes expectation({byte(eth::Instruction::PUSH1), 0x2, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
-					   byte(eth::Instruction::PUSH1), 0x1,
+	bytes expectation({byte(eth::Instruction::PUSH1), 0x2,
+					   byte(eth::Instruction::DUP3),
 					   byte(eth::Instruction::PUSH1), 0x0,
 					   byte(eth::Instruction::SUB),
-					   byte(eth::Instruction::NOT), byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
+					   byte(eth::Instruction::NOT),
 					   byte(eth::Instruction::EQ),
 					   byte(eth::Instruction::ISZERO)});
 	BOOST_CHECK_EQUAL_COLLECTIONS(code.begin(), code.end(), expectation.begin(), expectation.end());
@@ -315,7 +309,7 @@ BOOST_AUTO_TEST_CASE(assignment)
 	bytes code = compileFirstExpression(sourceCode, {}, {{"test", "f", "a"}, {"test", "f", "b"}});
 
 	// Stack: a, b
-	bytes expectation({byte(eth::Instruction::PUSH1), 0x2, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
+	bytes expectation({byte(eth::Instruction::PUSH1), 0x2,
 					   byte(eth::Instruction::DUP2),
 					   byte(eth::Instruction::DUP4),
 					   byte(eth::Instruction::ADD),
@@ -338,14 +332,14 @@ BOOST_AUTO_TEST_CASE(function_call)
 										{{"test", "f", "a"}, {"test", "f", "b"}});
 
 	// Stack: a, b
-	bytes expectation({byte(eth::Instruction::PUSH1), 0x02, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
-					   byte(eth::Instruction::PUSH1), 0x12,
-					   byte(eth::Instruction::PUSH1), 0x01, byte(eth::Instruction::PUSH1), 0xff, byte(eth::Instruction::AND),
+	bytes expectation({byte(eth::Instruction::PUSH1), 0x02,
+					   byte(eth::Instruction::PUSH1), 0x0c,
+					   byte(eth::Instruction::PUSH1), 0x01,
 					   byte(eth::Instruction::DUP5),
 					   byte(eth::Instruction::ADD),
 					   // Stack here: a b 2 <ret label> (a+1)
 					   byte(eth::Instruction::DUP4),
-					   byte(eth::Instruction::PUSH1), 0x19,
+					   byte(eth::Instruction::PUSH1), 0x13,
 					   byte(eth::Instruction::JUMP),
 					   byte(eth::Instruction::JUMPDEST),
 					   // Stack here: a b 2 g(a+1, b)
@@ -363,40 +357,36 @@ BOOST_AUTO_TEST_CASE(function_call)
 
 BOOST_AUTO_TEST_CASE(negative_literals_8bits)
 {
-	// these all fit in 8 bits
 	char const* sourceCode = "contract test {\n"
-							 "  function f() { int8 x = -0 + -1 + -0x01 + -127 + -128; }\n"
+							 "  function f() { int8 x = -0x80; }\n"
 							 "}\n";
 	bytes code = compileFirstExpression(sourceCode);
 
-	bytes expectation(bytes({byte(eth::Instruction::PUSH32)}) + bytes(31, 0xff) + bytes(1, 0x80) +
-					  bytes({byte(eth::Instruction::PUSH32)}) + bytes(31, 0xff) + bytes(1, 0x81) +
-					  bytes({byte(eth::Instruction::PUSH32)}) + bytes(32, 0xff) +
-					  bytes({byte(eth::Instruction::PUSH32)}) + bytes(32, 0xff) +
-					  bytes({byte(eth::Instruction::PUSH1), 0x00,
-							 byte(eth::Instruction::ADD),
-							 byte(eth::Instruction::ADD),
-							 byte(eth::Instruction::ADD),
-							 byte(eth::Instruction::ADD)}));
+	bytes expectation(bytes({byte(eth::Instruction::PUSH32)}) + bytes(31, 0xff) + bytes(1, 0x80));
 	BOOST_CHECK_EQUAL_COLLECTIONS(code.begin(), code.end(), expectation.begin(), expectation.end());
 }
 
 BOOST_AUTO_TEST_CASE(negative_literals_16bits)
 {
-	// -1 should need 8 bits, -129 should need 16 bits, how many bits are used is visible
-	// from the SIGNEXTEND opcodes
 	char const* sourceCode = "contract test {\n"
-							 "  function f() { int64 x = int64(-1 + -129); }\n"
+							 "  function f() { int64 x = ~0xabc; }\n"
+							 "}\n";
+	bytes code = compileFirstExpression(sourceCode);
+
+	bytes expectation(bytes({byte(eth::Instruction::PUSH32)}) + bytes(30, 0xff) + bytes{0xf5, 0x43});
+	BOOST_CHECK_EQUAL_COLLECTIONS(code.begin(), code.end(), expectation.begin(), expectation.end());
+}
+
+BOOST_AUTO_TEST_CASE(intermediately_overflowing_literals)
+{
+	// first literal itself is too large for 256 bits but it fits after all constant operations
+	// have been applied
+	char const* sourceCode = "contract test {\n"
+							 "  function f() { var x = (0xffffffffffffffffffffffffffffffffffffffff * 0xffffffffffffffffffffffffff01) & 0xbf; }\n"
 							 "}\n";
 	bytes code = compileFirstExpression(sourceCode);
 
-	bytes expectation(bytes({byte(eth::Instruction::PUSH32)}) + bytes(31, 0xff) + bytes(1, 0x7f) +
-					  bytes({byte(eth::Instruction::PUSH32)}) + bytes(32, 0xff) +
-					  bytes({byte(eth::Instruction::PUSH1), 0x00,
-							 byte(eth::Instruction::SIGNEXTEND),
-							 byte(eth::Instruction::ADD),
-							 byte(eth::Instruction::PUSH1), 0x01,
-							 byte(eth::Instruction::SIGNEXTEND)}));
+	bytes expectation(bytes({byte(eth::Instruction::PUSH1), 0xbf}));
 	BOOST_CHECK_EQUAL_COLLECTIONS(code.begin(), code.end(), expectation.begin(), expectation.end());
 }
 
diff --git a/test/SolidityOptimizer.cpp b/test/SolidityOptimizer.cpp
index 7e06c2e30..094702662 100644
--- a/test/SolidityOptimizer.cpp
+++ b/test/SolidityOptimizer.cpp
@@ -94,7 +94,7 @@ BOOST_AUTO_TEST_CASE(large_integers)
 				b = 0x10000000000000000000000002;
 			}
 		})";
-	compileBothVersions(33, sourceCode);
+	compileBothVersions(11, sourceCode);
 	compareVersions(0);
 }
 
@@ -106,7 +106,7 @@ BOOST_AUTO_TEST_CASE(invariants)
 				return int(0) | (int(1) * (int(0) ^ (0 + a)));
 			}
 		})";
-	compileBothVersions(28, sourceCode);
+	compileBothVersions(16, sourceCode);
 	compareVersions(0, u256(0x12334664));
 }
 
@@ -120,7 +120,7 @@ BOOST_AUTO_TEST_CASE(unused_expressions)
 				data;
 			}
 		})";
-	compileBothVersions(11, sourceCode);
+	compileBothVersions(8, sourceCode);
 	compareVersions(0);
 }
 
@@ -135,7 +135,7 @@ BOOST_AUTO_TEST_CASE(constant_folding_both_sides)
 				return 98 ^ (7 * ((1 | (x | 1000)) * 40) ^ 102);
 			}
 		})";
-	compileBothVersions(31, sourceCode);
+	compileBothVersions(12, sourceCode);
 	compareVersions(0);
 }
 
diff --git a/test/SolidityScanner.cpp b/test/SolidityScanner.cpp
index b7942d293..7dc9ef482 100644
--- a/test/SolidityScanner.cpp
+++ b/test/SolidityScanner.cpp
@@ -103,14 +103,17 @@ BOOST_AUTO_TEST_CASE(negative_numbers)
 	BOOST_CHECK_EQUAL(scanner.getCurrentToken(), Token::VAR);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::IDENTIFIER);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::ASSIGN);
+	BOOST_CHECK_EQUAL(scanner.next(), Token::SUB);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::NUMBER);
-	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "-.2");
+	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), ".2");
 	BOOST_CHECK_EQUAL(scanner.next(), Token::ADD);
+	BOOST_CHECK_EQUAL(scanner.next(), Token::SUB);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::NUMBER);
-	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "-0x78");
+	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "0x78");
 	BOOST_CHECK_EQUAL(scanner.next(), Token::ADD);
+	BOOST_CHECK_EQUAL(scanner.next(), Token::SUB);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::NUMBER);
-	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "-7.3");
+	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "7.3");
 	BOOST_CHECK_EQUAL(scanner.next(), Token::ADD);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::NUMBER);
 	BOOST_CHECK_EQUAL(scanner.getCurrentLiteral(), "8.9");
@@ -130,8 +133,9 @@ BOOST_AUTO_TEST_CASE(locations)
 	BOOST_CHECK_EQUAL(scanner.next(), Token::SEMICOLON);
 	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().start, 24);
 	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().end, 25);
+	BOOST_CHECK_EQUAL(scanner.next(), Token::SUB);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::NUMBER);
-	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().start, 26);
+	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().start, 27);
 	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().end, 32);
 	BOOST_CHECK_EQUAL(scanner.next(), Token::IDENTIFIER);
 	BOOST_CHECK_EQUAL(scanner.getCurrentLocation().start, 45);