Scarcity necessitates rationing

Scarcity makes rationing a necessity. When a good or resource is scarce, some criterion must be used to determine who will receive it and who will go without. The choice of which method is used will, however, have an influence on human behavior. When rationing is done through the government sector, a person’s political status and ability to manipulate the political process are the key factors. Powerful interest groups and those in good favor with influential politicians will be the ones who obtain goods and resources. When this method of rationing is used, people will devote time and resources to lobbying and favor seeking with those who have political power, rather than to productive activities.
When the criterion is first-come, first-served, goods are allocated to those who are fastest at getting in line or most willing to spend time waiting in line. Many colleges use this method to ration tickets to sporting events, and the result is students waiting in long lines (and sometimes even camping out overnight) to obtain tickets. Imagine how the behavior of students would change if tickets were instead given out to the students with the highest grade point average.
In a market economy, price is generally used to ration goods and resources only to those who are willing and able to pay the prevailing market price. Because only those goods that are scarce require rationing, in a market economy, one easy way to determine whether a good or resource is scarce is to ask if it sells for a price. If you have to pay for something, it is scarce.