Can Rationing Increase Welfare? Theory and an Application to India's Ration Shop System

• 成果类型: Article
• 署名作者: Gadenne, Lucie
• 署名单位: University of Warwick; Centre for Economic Policy Research - UK
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20180659
• 发表日期: 2020
• 页码: 144-177
• 关键词: in-kind; tax; taxation; cash; ENFORCEMENT; INFORMATION; commodity; nutrition; transfers; impacts

摘要

In many developing countries, households can purchase limited quantities of goods at a fixed subsidized price through ration shops. This paper asks whether the characteristics of developing countries explain why governments use such systems. I find an equity-efficiency trade-off: an efficiency-maximizing government will never use ration shops, but a welfare-maximizing one might to redistribute and provide insurance. Welfare gains of ration shops will be highest for necessity goods and goods with high price risk. I calibrate the model for India and find that ration shops are welfare improving for three of the four goods sold through the system today.