Wenger pointed to the money going out of the country to overseas clubs to sign players like Angel di Maria, claiming he had wanted to sign the Argentina winger as a 17-year-old, and also suggested that opening up the restrictions would help develop young English players.
The Frenchman said on Thursday: "If you want to be the best league in the world then you have to accept that you have to produce the best players in the world, so the question is how can you produce the best players?
"If you put a young player with top-level players, he has more chance to develop
If you put him with average players he has more chance to remain average."
But Allardyce was quick to reject that view
"I don't agree with that at all," he said
"There's already a massive influx of foreign youth coming to academies and us losing the opportunities for young British players to take up those places.
"That (abolishing the work permit rule) for me, as an Englishman, is a real no-no
I'm sure Arsene, if he was working in France, would have a similar opinion to me
"Protect your own
We very rarely do it in this country and haven't done it up until now.
"We've got to do it somewhere along the line and get more British players through.
"If we open up the doors, the floodgates would open and there would be very, very few British players who would even get the chance at a football club."
The rules state a player must have featured in 75 per cent of his country's international matches over the last two years - with his country in the top 70 of FIFA's rankings - to qualify for a 'Governing Body Endorsement'
Should a player fail to meet those criteria, a club can request an appeal hearing to " consider whether the player is able to contribute significantly to the development of the game at the top level in England"
West Ham's signing of Ecuador World Cup star Enner Valencia required an appeal, as did Leicester's recent acquisition of Croatian Andrej Kramaric
Wenger and Arsenal would also need to succeed in an appeal should they agree a deal for Villarreal's uncapped Brazilian centre-back Gabriel Paulista.
"I think the rules are fine at the moment," Allardyce added
"You can get a work permit if there is an exceptional talent and it can be proven."
Source : PA
Source: PA