Rationing in Nicaragua direct hit. Trade and investment plummeted, unemployment soared to 25 percent, and inflation reached more than 36,000 percent by 1988. From 1980 to 1990, Nicaragua’s average real per capita income fell 35 percent, and the incidence of poverty rose to 44 percent. Rationing in Nicaragua In 1984, the FSLN announced rationing for 20 basic goods, including rice, sugar, milk, and toilet paper. At this time, the FSLN were fighting an expensive war against the Contra guerrillas who were funded by the Reagan Administration. The FSLN tried to stabilize the economy by focusing more on the production of export crops and
Grain rationing in China However demand exceeded supply and the agricultural sector produced very inefficiently. The government tried to solve this problem by introducing a grain rationing system, combining consumer rationing and compulsory purchases from producers. The gradual development of a free market put an end to the rationing system and introduced dual prices. This is where the price-scissors phenomena emerged. Figures assume that there are only two sectors (rural and urban) producing two goods (manufactures and food) and that the supply of the two goods is fixed. The amount of food that a peasant household will sell in exchange for manufactured goods can