Managing scarcity to serve the public interest is a classic government task. An important way to execute this task is by allocating individual rights that are only available in limited quantities, such as CO2 emission allowances, gambling licences, subsidies, radio frequencies, public contracts and parking permits. Whereas economic and political theory has paid much attention to the allocation of scarce goods and rights, until now a consistent and general legal theory of 'the allocating government' has been missing. This is striking given the fact that limited rights have to be allocated...