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Just to chime in with the relevant Jewish law, the first point is correct, but houses built on the outskirts of the city would count as within the area of the city, so unless there is some other non-biblical requirement that the Sadducees imposed, there wasn't really an artificial scarcity - just the natural one of how far you can travel. The second point, though, is exactly right even according to the Pharisees - see the Mishna Shekalim, which explains the specifics of what can be given, and the requirement to use a moneychanger and pay a specific fee.

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