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Rationing Rules and Outcomes; The Experience of Singapore’s Vehicle Quota System


  • Ling H Tan


Since 1990, Singapore has sought to control motor vehicle ownership by means of an auction quota system, whereby prospective vehicle buyers need to obtain a quota license before they can make their purchase. This paper assesses the success of the vehicle quota system in meeting its objectives of stability in motor vehicle growth, flexibility in the motor vehicle mix, and equity among motor vehicle buyers. Two important implementation issues-quota subcategorization and license transferability-are highlighted, and policy lessons are drawn for the design of auction quotas in general.

Suggested Citation

  • Ling H Tan, 2001. "Rationing Rules and Outcomes; The Experience of Singapore’s Vehicle Quota System," IMF Working Papers 01/136, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:01/136

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    References listed on IDEAS

    1. Phang, Sock-Yong & Wong, Wing-Keung & Chia, Ngee-Choon, 1996. "Singapore's experience with car quotas : Issues and policy processes," Transport Policy, Elsevier, vol. 3(4), pages 145-153, October.
    2. Swan, Peter L, 1970. "Durability of Consumption Goods," American Economic Review, American Economic Association, vol. 60(5), pages 884-894, December.
    3. repec:adr:anecst:y:1997:i:47:p:03 is not listed on IDEAS
    4. Krishna, Kala & Tan, Ling Hui, 1999. "Transferable Licenses versus Nontransferable Licenses: What Is the Difference?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(3), pages 785-800, August.
    5. repec:adr:anecst:y:1997:i:47:p:04 is not listed on IDEAS
    6. Ngee-Choon Chia & Albert K. C. Tsui & John Whalley, 2001. "Ownership and Use Taxes as Congestion Correcting Instruments," NBER Working Papers 8278, National Bureau of Economic Research, Inc.
    7. Carlos Alfredo Rodriguez, 1979. "The Quality of Imports and the Differential Welfare Effects of Tariffs, Quotas, and Quality Controls as Protective Devices," Canadian Journal of Economics, Canadian Economics Association, vol. 12(3), pages 439-449, August.
    8. Halvorsen, Robert & Palmquist, Raymond, 1980. "The Interpretation of Dummy Variables in Semilogarithmic Equations," American Economic Review, American Economic Association, vol. 70(3), pages 474-475, June.
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    Cited by:

    1. Wang, Rui, 2010. "Shaping urban transport policies in China: Will copying foreign policies work?," Transport Policy, Elsevier, vol. 17(3), pages 147-152, May.
    2. Santos, Georgina & Li, Wai Wing & Koh, Winston T.H, 2004. "9. Transport Policies In Singapore," Research in Transportation Economics, Elsevier, vol. 9(1), pages 209-235, January.
    3. Koh, Winston T. H., 2003. "Control of vehicle ownership and market competition: theory and Singapore's experience with the vehicle quota system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(9), pages 749-770, November.
    4. Chu, Sing-Fat & Koh, Winston T. H. & Tse, Yiu Kuen, 2004. "Expectations formation and forecasting of vehicle demand: an empirical study of the vehicle quota auctions in Singapore," Transportation Research Part A: Policy and Practice, Elsevier, vol. 38(5), pages 367-381, June.
    5. Winston T.H. Koh, 2004. "Congestion Control and Vehicle Ownership Restriction: The Choice of an Optimal Quota Policy," Journal of Transport Economics and Policy, University of Bath, vol. 38(3), pages 371-402, September.

    More about this item


    Auctions; Quotas; Singapore; licenses; transferability; subcategorization; motor vehicle; motor vehicles; bids; bidders; motorcycles; Licences;

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy


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