The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 17

The U.S. Department of Agriculture used to control hops production by assigning each established hops grower a specific share of the total amount of hops that could be sold. Those who wanted to go into the business of growing hops had to purchase or lease allotments from existing growers, at a considerable price. The Agriculture Department, in announcing its decision to terminate the system, objected to the fact that new growers had to pay for an allotment that had been given to the original growers at no charge. Does the Agriculture Department's objection make any sense? If the allotments had not acquired any market value, what would this imply about the original decision to restrict hops production?