Post Investment hold Up
Probably the most important source of capital is human capital. For example, most medical doctors spend years years learning to practice medicine. Doctors are willing to make large investments in their human capital because they expect to be compensated for doing so when they begin work. In Canada, the government nationalized the healthcare system and reduced doctors compensation. Is this a form of post- investment hold-up?
Yes ,it is a post -investment hold up problem. This arises due to the problem of difficulty in writing complete contract. In... View the full answer