In economics, the hold-up problem is central to the theory of incomplete contracts, and shows the difficulty in writing complete contracts.

What does the hold-up problem do?

The hold-up problem is a situation where two parties may be able to work most efficiently by cooperating but refrain from doing so because of concerns that they may give the other party increased bargaining power and thus reduce their own profits.

What is post investment hold up in economics?

Hold-up arises when part of the return on an agent's relationship-specific investments is ex post expropriable by his trading partner. ... Once such an investment is sunk, the investor has to share the gross returns with her trading partner. This problem, known as hold-up, is inherent in many bilateral exchanges.