The specificity of the asset (or investment) leads to the possibility of

Question

Quizplus · Accepted Answer

Specificity of the asset or investment refers to the uniqueness of the resource or investment, making it difficult to find an alternative or use it for a different purpose. This creates the potential for opportunistic behavior, such as one party taking advantage of the other's dependence on the specific asset or investment. This can lead to problems such as hold-up or expropriation. Thus, the best choice is C, which refers to opportunism. A refers to collusion, which is a type of coordinated behavior that may arise when parties have similar interests. B refers to a situation where parties choose not to cooperate even if it would be beneficial to do so, arising from the lack of trust between them. Neither of these options are directly related to the specificity of the asset or investment.

The Specificity of the Asset (Or Investment) Leads to the Possibility