TY - JOUR
T1 - Prices versus quantities
T2 - The political perspective
AU - Finkelshtain, Israel
AU - Kislev, Yoav
PY - 1997/2
Y1 - 1997/2
N2 - Regulation regimes subject to the influence of interest groups are compared. It is shown that the allocation of the regulated commodity varies with the implemented control and that the advantage of prices (vs. quotas) increases with the elasticity of the demand for or the supply of the commodity and decreases with the number of organized producers in the regulated industry. Control regimes can be ranked for negative, but not positive, externalities. Finally, a control regime leading to a more efficient commodity allocation also entails using fewer resources in rent-seeking activities.
AB - Regulation regimes subject to the influence of interest groups are compared. It is shown that the allocation of the regulated commodity varies with the implemented control and that the advantage of prices (vs. quotas) increases with the elasticity of the demand for or the supply of the commodity and decreases with the number of organized producers in the regulated industry. Control regimes can be ranked for negative, but not positive, externalities. Finally, a control regime leading to a more efficient commodity allocation also entails using fewer resources in rent-seeking activities.
UR - http://www.scopus.com/inward/record.url?scp=0002238965&partnerID=8YFLogxK
U2 - 10.1086/262066
DO - 10.1086/262066
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AN - SCOPUS:0002238965
SN - 0022-3808
VL - 105
SP - 83
EP - 100
JO - Journal of Political Economy
JF - Journal of Political Economy
IS - 1
ER -