The hold- up problem:
A)refers to the the incentives to appropriate economic rents.
B)refers to various problems delaying production.
C)is the main reasons for bridges not being built.
D)refers to the banks at risk of being robbed.

Question

Quizplus · Accepted Answer

The hold-up problem refers to the incentives of a party (usually a supplier or provider) to appropriate economic rents, such as by raising the price of goods or services after initial investments have been made by the other party (usually a buyer or distributor). This can lead to delays or breakdowns in business relationships and transactions.

The Hold- Up Problem