Rationing

Filed Under » , ,
Dictionary Says

Definition of 'Rationing'

The artificial restriction of raw materials, goods or services. Rationing commonly occurs when governments fear a shortage and want to make sure people have access to necessities, such as after a natural disaster or during a war. Governments can also impose rationing in the face of failed policies such as central planning, or may be forced to use rationing as a result of shortages.
Investopedia Says

Investopedia explains 'Rationing'

For example, during World War II, the U.S. government imposed rationing on the country so that sufficient materials and production capabilities would be available to the military. It did not matter how much of an item an individual or family wanted or could afford to purchase; people were only allowed to purchase a limited amount specified by the government and controlled by ration coupons. Items including tires, gasoline, sugar, meat, butter and many others were subject to rationing.

Rationing can lead to the creation of black markets for the rationed goods. Black markets allow individuals to use their allotment of a rationed good that they don’t need to obtain more of a rationed good that they do need.

Related Definitions

Search results for

'Rationing'

  • Historical Ideas To Create A Workable Budget - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0911/Historical-Ideas-To-Create-A-Workable-Budget.aspx
    ... campaign, which allowed submarines to sink merchant ships carrying supplies to people
    in Britain, made the shortage fears real and necessitated food rationing. ...

  • Austerity: When The Government Tightens Its Belt

    http://www.investopedia.com/articles/economics/11/goverment-austerity-measures.asp
    ... TUTORIAL: Market Crashes At the same time, the government imposed widespread
    austerities on its citizens in the form of commodity rationing, including food ...

  • CFA Level 1 Study Guide - Corporate Finance - Security Market Line ...

    http://www.investopedia.com/exam-guide/cfa-level-1/corporate-finance/security-market-line-beta-basics.asp
    Learn how the security market line relates to market risk. Covers two methods
    for estimating beta and the capital rationing process. ...

  • China's Future Hindered By Power Shortages

    http://stocks.investopedia.com/stock-analysis/2011/Chinas-Future-Hindered-By-Power-Shortages-GXC-CHXX-ABB-ETN-BGC-NLR-FWLT0818.aspx
    ... kilowatts shortage each day. The local government has been rationing electrical
    power since early this year. The key central provinces ...

  • The German Economic Miracle

    http://www.investopedia.com/articles/economics/09/german-economic-miracle.asp
    ... day. After the war, the Allies continued this food rationing policy and
    limited the population to eat between 1,000-1,500 calories. ...

  • Market Speculators: More Help Than Harm

    http://www.investopedia.com/articles/basics/09/the-function-of-speculators.asp
    ... to head off shortages. Shortages are dangerous because they lead to price
    spikes and/or rationing of resources. If a drought kills ...

  • Wall Street History: Antitrust, OPEC And Disney - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/1010/Wall-Street-History-Antitrust-OPEC-And-Disney.aspx
    ... against Syria. The cost of a barrel of oil quadrupled and President Nixon
    introduced price controls and rationing. Speed limits ...

  • Meet OPEC, Manager Of Oil Wealth

    http://www.investopedia.com/articles/economics/09/organization-petroleum-exporting-countries-opec.asp
    ... the New York Stock Exchange. Inflation ensued and gasoline rationing practices
    were enforced. OPEC eventually restored oil production ...

  • Trading Calendar Spreads In Grain Markets

    http://www.investopedia.com/articles/optioninvestor/calendar-spread-grain-market.asp
    ... in Digging Deeper Into Bull And Bear Markets.) Conclusion Examine the supply situation
    for the given commodity and determine if any demand rationing will need ...

  • Commodities: Cotton | Investopedia

    http://www.investopedia.com/university/commodities/commodities5.asp
    ... Cotton's intensive need for water pushed the industry to the forefront
    of the debate over water rationing and drought management. ...

Related Articles

Partner Links