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Abstract
During the gas shortage in the winter of 1973-74, farmers were high on the priority list
for gasoline allocations. Under the proposed exchangeable coupon gasoline rationing, this
allocative machinery and priority system would be superseded by a coupon resale market.
The exchangeable coupon resale market is examined from the perspective of a consuming
household and of a producing iu;m. The conclusion is that the coupon resale market will
ration gas among the same uses that a higher market price would-the difference being not
one ofallocation ofgas among alternative uses, but one of redistribution of income. The
amount of income to be redistributed is estimated in the neighborhood of $28 billion per
year.