"Firms would be given initial entitlements to gross markup on the basis of past performance. These entitlements would be transferable and a market in them would be developed"

This quote by William Vickrey suggests that firms need to be given an initial entitlement to gross markup based upon their past performance. This privilege would be transferable, indicating that firms would be able to trade it with other firms. This would create a market for these entitlements, enabling companies to purchase and offer them in order to optimize their earnings. This would also produce a competitive environment, as companies would be incentivized to improve their performance in order to increase their entitlement. This would cause increased effectiveness and productivity, as companies would be completing to produce the very best outcomes. Overall, this quote suggests that developing a market for privileges based upon previous performance would be helpful for companies and the economy as a whole.