What is a holdout in economics?

Published by Charlie Davidson on

What is a holdout in economics?

The holdout problem is a form of anti-commons. It arises when owners of a valuable resource choose not to sell, even though a positive surplus may exist between buyer and seller. Holdouts thereby prevent resources from flowing to more valued uses, thus subtracting from allocative efficiency.

What is a holdout creditor?

Holdouts are creditors that are in a position to block a restructuring and use that leverage to extract additional value for themselves (i.e., payment in full from the debtor, other creditors or a hedge counterparty). An out-of-court restructuring may be initiated by the debtor or by one or more creditors.

What is a hold out problem?

The holdout problem “represents a situation where landowners whose property is essential to the completion of some large development project to seek to block completion of the project in an effort to extract monopoly rents”

What holdout means?

English Language Learners Definition of holdout : a person who refuses to reach an agreement until certain terms are met : a person who holds out. : an act of holding out for something. : a person who continues to do or use something after others have stopped doing or using it.

What are holdout investors?

In finance, a holdout problem occurs when a bond issuer is in default or nears default, and launches an exchange offer in an attempt to restructure debt held by existing bond holders.

What is the Coase theorem in economics?

What Is the Coase Theorem? The Coase Theorem is a legal and economic theory developed by economist Ronald Coase regarding property rights, which states that where there are complete competitive markets with no transaction costs and an efficient set of inputs and outputs, an optimal decision will be selected.

What is a holdout test?

Holdout testing: what is it? Holdout testing is the practice of regularly gut checking your email program to make sure that the campaigns being sent are actually generating true lift. “Lift” is defined as the incremental increase in revenue that is generated (or not generated) by sending a marketing campaign.

What is Coase Theorem example?

Coase theorem is the idea that under certain conditions, the issuing of property rights can solve negative externalities. For example, a Forrester will manage their forest to ensure its longevity and protect it from fires. It is their incentive to do so in order for them to be able to sell logs in future years.

Why is the Coase Theorem important?

The Coase Theorem offers a potentially useful way to think about how to best resolve conflicts between competing businesses or other economic uses of limited resources.

What is holdout sample?

A hold-out sample is a random sample from a data set that is withheld and not used in the model fitting process. This gives an unbiased assessment of how well the model might do if applied to new data.

What is the purpose of a holdout set?

A holdout set is used to verify the accuracy of a forecast technique.

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