Wikipedia defines rationing as follows:
In economics, rationing is an artificial restriction of demand. It is done to keep price below the equilibrium (market-clearing) price determined by the process of supply and demand in an unfettered market. Thus, rationing can be complementary to price controls. An example of rationing in the face of rising prices took place in the Netherlands, where there was rationing of gasoline in the 1973 energy crisis.Now medical care isn't the only social service or commodity that can be rationed. As the monetary policy of the Federal Reserve system successfully demonstrates, even the total available money supply that floats the capitalist system can be "rationed" as well. But unsuccessful attempts at the inverse-rationing policy of expanding the base of available credit to many low income previosuly ineligible members, as with the housing collapse of 2007 demonstrated, have proven to be absolutely disastrous to a socialist economy in transition from captitalism to communism.
Romanian ration card, 1989A reason for setting the price lower than would clear the market may be that there is a shortage, which would drive the market price very high. High prices, especially in the case of necessities, are undesirable with regard to those who cannot afford them. Traditionalist economists argue, however, that high prices act to reduce waste of the scarce resource while also providing incentive to produce more (this approach requires assuming no horizontal inequality).
In wartime, it is usually imperative for a government to maintain the support of this part of the population, to maintain "equality" especially since in most countries, the poor and underclass families contribute most of the soldiers.
Rationing using coupons is only one kind of non-price rationing. For example, scarce products can be rationed using queues. This is seen, for example, at amusement parks, where one pays a price to get in and then need not pay any price to go on the rides. Similarly, in the absence of road pricing, access to roads is rationed in a first come, first served queueing process, leading to congestion.
Authorities which introduce rationing often have to deal with the rationed goods being sold illegally on the black market.
Health care rationingShortages of organs for donation force the rationing of hearts, livers, lungs and kidneys in the United States. During the 1940s, a limited supply of iron lungs for polio victims forced physicians to ration these machines. Dialysis machines for patients in kidney failure were rationed between 1962 and 1967. More recently, Tia Powell led a New York State Workgroup that set up guidelines for rationing ventilators during a flu pandemic. Jacob Appel, a bioethicist, recently described the effects of rationing ventilators bluntly: "Some unfortunate individuals will have to be removed from life support so that others may live."
Among those who have argued in favor of health-care rationing are moral philosopher Peter Singer and former Oregon governor John Kitzhaber.
Triage is the rationing of medical care in an emergency situation.
