Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123175
Authors: 
Eggert, Wolfgang
Stephan, Maximilian
Temme, Janine
von Ungern-Sternberg, Handirk
Year of Publication: 
2015
Series/Report no.: 
CESifo Working Paper 5527
Abstract: 
We argue a holdout is not a destructive investor behaviour but a rational investment decision. This investment decision is characterised by the mean-variance approach. We investigate intercreditor conflict by diverse portfolio structure. We demonstrate that at some point during the Greek (2012) and Argentine (2005) debt restructuring programs it was reasonable for the investor to hold out. This model shows that the investment decision is based on the portfolio structure, risk aversion and expected payment of the debtor, so there is no free-rider behaviour. On the contrary, the investor harms herself when playing a destructive or uncooperative strategy.
Subjects: 
sovereign debt
holdout
mean-variance approach
collective action clause
JEL: 
G18
H50
H63
Document Type: 
Working Paper

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