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Queues, Rations, and Market: Comparisons of Outcomes for the Poor and the Rich


  • Sah, Raaj Kumar


This paper presents a positive comparison of the outcomes of several alternative allocation systems (the queue system, convertible and nonconvertible rations, and the unhindered market) to distribute the limited quantity of a deficit good among heterogeneous individuals. The authors show that, for the poor, the ranking of systems (from better to worse) is: convertible rations, nonconvertible rations, the queue system, and nonintervention. The rich are found to be better off under nonintervention than under other systems. These and other results are notably robust not only to many parameters of the economy, but also to certain types of commodity taxes and administrative costs. Copyright 1987 by American Economic Association.

Suggested Citation

  • Sah, Raaj Kumar, 1987. "Queues, Rations, and Market: Comparisons of Outcomes for the Poor and the Rich," American Economic Review, American Economic Association, vol. 77(1), pages 69-77, March.
  • Handle: RePEc:aea:aecrev:v:77:y:1987:i:1:p:69-77

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    References listed on IDEAS

    1. Altonji, Joseph G, 1986. "Intertemporal Substitution in Labor Supply: Evidence from Micro Data," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 176-215, June.
    2. Martin Neil Baily, 1974. "Wages and Employment under Uncertain Demand," Review of Economic Studies, Oxford University Press, vol. 41(1), pages 37-50.
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    4. Heckman, James J, 1974. "Life Cycle Consumption and Labor Supply: An Explanation of the Relationship Between Income and Consumption Over the Life Cycle," American Economic Review, American Economic Association, vol. 64(1), pages 188-194, March.
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    6. MaCurdy, Thomas E, 1981. "An Empirical Model of Labor Supply in a Life-Cycle Setting," Journal of Political Economy, University of Chicago Press, vol. 89(6), pages 1059-1085, December.
    7. Joseph G. Altonji & Christina H. Paxson, 1985. "Job Characteristics and Hours of Work," Working Papers 578, Princeton University, Department of Economics, Industrial Relations Section..
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    9. Lucas, Robert E, Jr & Rapping, Leonard A, 1969. "Real Wages, Employment, and Inflation," Journal of Political Economy, University of Chicago Press, vol. 77(5), pages 721-754, Sept./Oct.
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    Cited by:

    1. Amal Sanyal, 2004. "Bribes in a Supply Line," Economica, London School of Economics and Political Science, vol. 71, pages 155-168, February.
    2. Stéphanie Souche & Charles Raux, 2006. "Perception of the fairness of pricing," Post-Print halshs-00109055, HAL.
    3. Fridman, Alla, 1997. "Privatization and Price Liberalization: Comparative Analysis," Journal of Comparative Economics, Elsevier, vol. 24(3), pages 313-334, June.
    4. Jeremy Clark & Bonggeun Kim, 2006. "Differential Time and Money Pricing as a Mechanism for In-kind Redistribution," Working Papers in Economics 06/07, University of Canterbury, Department of Economics and Finance.
    5. Bennett, John, 1998. "Prices versus quantities and distributional inefficiency," Economics Letters, Elsevier, vol. 58(1), pages 63-67, January.
    6. Michael Sattinger, 2002. "A Queuing Model of the Market for Access to Trading Partners," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(2), pages 533-548, May.
    7. Bennett, John & Dixon, Huw David, 1995. "Macroeconomic equilibrium and reform in a transitional economy," European Economic Review, Elsevier, vol. 39(8), pages 1465-1485, October.
    8. Christoph Starke, 2010. "Serving the Many or Serving the Most Needy?," FEMM Working Papers 100002, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
    9. Suttner, Johannes R., 2014. "Sensitivity of economists during market allocation," CIW Discussion Papers 3/2014, University of Münster, Center for Interdisciplinary Economics (CIW).
    10. Ralph Bradburd & Stephen Sheppard & Joseph Bergeron & Eric Engler, 2006. "The Impact Of Rent Controls In Non-Walrasian Markets: An Agent-Based Modeling Approach," Journal of Regional Science, Wiley Blackwell, vol. 46(3), pages 455-491.
    11. Charles Raux & Stéphanie Souche & Yves Croissant, 2009. "How fair is pricing perceived to be? An empirical study," Public Choice, Springer, vol. 139(1), pages 227-240, April.
    12. Alexeev, Michael & Sabyr, Lyaziza, 2004. "Black markets and pre-reform crises in former socialist economies," Economic Systems, Elsevier, vol. 28(1), pages 1-12, March.
    13. Souche, Stéphanie & Raux, Charles & Croissant, Yves, 2012. "On the perceived justice of urban road pricing: An empirical study in Lyon," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(7), pages 1124-1136.
    14. Alexeev, Michael & Leitzel, James, 2001. "Income distribution and price controls: Targeting a social safety net during economic transition," European Economic Review, Elsevier, vol. 45(9), pages 1647-1663, October.
    15. Djajic, Slobadan, 1999. "Shortages, Hoarding and Parallel-Market Premia in an Economy with Administered Prices," Review of Development Economics, Wiley Blackwell, vol. 3(1), pages 1-10, February.
    16. Christoph Starke, 2012. "Serving the many or serving the most needy?," Economics of Governance, Springer, vol. 13(4), pages 365-386, December.
    17. Leitzel, Jim, 1998. "Goods Diversion and Repressed Inflation: Notes on the Political Economy of Price Liberalization," Public Choice, Springer, vol. 94(3-4), pages 255-266, March.
    18. repec:kap:transp:v:45:y:2018:i:1:d:10.1007_s11116-016-9733-3 is not listed on IDEAS
    19. Amitrajeet Batabyal, 2005. "On bribing and balking in a simple queuing model of resource allocation," Economics Bulletin, AccessEcon, vol. 16(1), pages 1-10.
    20. Kulshreshtha, Praveen, 2007. "An efficiency and welfare classification of rationing by waiting in the presence of bribery," Journal of Development Economics, Elsevier, vol. 83(2), pages 530-548, July.
    21. Che, Yeon-Koo & Gale, Ian, 2006. "Market versus Non-Market Assignment of Initial Ownership," MPRA Paper 6095, University Library of Munich, Germany, revised 30 May 2006.
    22. Jeremy Clark & Bonggeun Kim, 2007. "Paying vs. waiting in the pursuit of specific egalitarianism," Oxford Economic Papers, Oxford University Press, vol. 59(3), pages 486-512, July.
    23. Stephen Coate, 1986. "Should Food Aid Be Given Away or Sold During a Famine?," Discussion Papers 701, Northwestern University, Center for Mathematical Studies in Economics and Management Science.

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