Randall and stollʹs bound in an inverse demand system

This letter extends Randall and Stollʹs and Hanemannʹs results into a complete inverse demand system. It provides a theoretically consistent framework for welfare measurement under quantity restrictions and free adjustment of prices in an equilibrium. It is found that Randall and Stollʹs and Hanemannʹs results should be modified to fit into the complete inverse demand system since they may give misleading interpretation of empirical studies in some cases.