Value Extraction

Value extraction occurs when an entity (individual, or organization) appropriates economic gains vastly out of proportion with their contribution to said gains.

Value extraction can be contrasted with value creation, where new goods or services are created.

One example of value extraction is an individual or real estate company who buys vacant land near a developing city, and holds the land while the city continues to develop, waiting until the property value has risen and the land can be sold at a profit – despite making no contribution themselves.