Holdups and holdouts: What do they have in common?

The holdup and holdout problems arise in different contexts, but they share certain fundamental similarities that have not generally been recognized. This paper characterizes the commonalties between the two problems and their remedies. ► The holdup and holdout problems are often confused. ► Holdups...

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Bibliographic Details
Published inEconomics letters Vol. 117; no. 1; pp. 330 - 333
Main Authors Miceli, Thomas J., Segerson, Kathleen
Format Journal Article
LanguageEnglish
Published Amsterdam Elsevier B.V 01.10.2012
Elsevier Science Ltd
Subjects
Bargaining
Bonds
Economic models
Eminent domain
Exchange
Holdout problem
Holdup problem
Investment
Mathematical problems
Non-salvageable investments
Problem solving
Studies
Eminent domain
Holdup problem
D23
Holdout problem
Non-salvageable investments
K11
L23
L14
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Summary:The holdup and holdout problems arise in different contexts, but they share certain fundamental similarities that have not generally been recognized. This paper characterizes the commonalties between the two problems and their remedies. ► The holdup and holdout problems are often confused. ► Holdups usually arise in contract settings where one party makes a transaction-specific investment prior to trade. ► Holdouts arise in the case of land assembly for large scale development projects. ► This paper uses a simple model to reveal the commonalities between the two problems.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 23
ISSN:0165-1765
1873-7374
DOI:10.1016/j.econlet.2012.05.036