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In this paper, we develop an approach toward joint source-channel coding for motion-compensated DCT-based scalable video coding and transmission. A framework for the optimal selection of the source and channel coding rates over all scalable layers is presented such that the overall distortion is minimized. The algorithm utilizes universal rate distortion characteristics which are obtained experimentally and show the sensitivity of the source encoder and decoder to channel errors. The proposed algorithm allocates the available bit rate between scalable layers and, within each layer, between source and channel coding. We present the results of this rate allocation algorithm for video transmission over a wireless channel using the H.263 Version 2 signal-to-noise ratio (SNR) scalable codec for source coding and rate-compatible punctured convolutional (RCPC) codes for channel coding. We discuss the performance of the algorithm with respect to the channel conditions, coding methodologies, layer rates, and number of layers.