Government subsidies always lead to an increase in overall welfare without any unintended consequences, such as market distortions or dependency on subsidies.

Government subsidies are financial support from the government to help businesses or individuals, often aimed at encouraging certain activities or making goods more affordable. While they can increase overall welfare by making services or products more accessible, they can also create unintended consequences. For example, if the government subsidizes a particular crop, farmers might focus only on that crop, leading to fewer varieties in production and possibly harming the environment. This focus can distort the market, making it less competitive and reducing innovation. Therefore, while subsidies can provide immediate benefits, they can also lead to long-term issues that need careful management.