Overview
Subsidies are essential tools used by governments to support various sectors of the economy. They can take many forms, including direct payments and tax incentives, and are designed to make goods and services more affordable or to encourage production in specific areas. Understanding the different t...
Key Terms
Example: The government provided a subsidy to farmers to lower the cost of wheat production.
Example: Cash payments to low-income families for housing.
Example: Tax credits for renewable energy installations.
Example: Subsidies for corn production to support farmers.
Example: Subsidized public transport fares for students.
Example: Overproduction of goods due to excessive subsidies.
Related Topics
Government Intervention
Explores how government actions affect economic activities and market outcomes.
intermediateMarket Structures
Examines different types of market structures and their characteristics.
intermediateFiscal Policy
Discusses government spending and taxation policies and their economic impacts.
advancedKey Concepts
Direct SubsidiesIndirect SubsidiesProduction SubsidiesConsumption Subsidies