rationing

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Fig. 165 Rationing.

rationing

a physical method of allocating a product that is in short supply relative to demand (EXCESS DEMAND). In a free market this situation would not arise - the excess demand would be ‘choked off and additional supply encouraged by an increase in the price of the product (see EQUILIBRIUM MARKET PRICE). But if the price is fixed below its equilibrium rate (for example, by the government wishing to hold down the prices of key products such as food), the use of ration tickets provides one practical means of allocating the available supply between consumers on an equitable basis.

In Fig. 165, for example, if the price of a product is fixed by the government at Or, then it is necessary to ration the amount of output that producers are willing to supply, OQr, at this price amongst consumers who are demanding the greater amount of OQs. See also BLACK MARKET, PRICE CONTROLS.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
Also consistent with the current study, 96%98% of nurses in the European studies rationed at least one of the queried activities during the previous seven shifts (Schubert et al., 2008; Schubert et al., 2013) and most rationed over half of the activities queried (Papastavrou et al., 2014).
Indeed, health care is implicitly rationed in myriad ways,
But CO2 and other social wages are identical in their need to be rationed to ensure that everyone receives enough for a good quality life.
Children enjoy a piece of fruit cake made out of rationed goods - but today's diets are often poorer than during the war when rationing restricted choice
Bread and potatoes, which had not been rationed during the war - although quality had suffered - were suddenly rationed in 1946 and 1947 respectively.
By March 1940 meat was also being rationed with tea following in the July.
Potatoes and peas were dropped from the list of rationed foods, meaning Cubans can buy as much of the products as they want--as long as they're willing to pay as much as 20 times more than they used to.
Soon after, all meat was rationed and the restrictions spread to other foodstuffs and clothes.