Subsidy, another term for subvention, is financial assistance or
support given to a specific economic sector. Usually, subsidies
are provided by the government as a preventive measure for the
downfall of a specific industry. The government also pays
subsidies when there is a price increase in that particular
industry, or if the government wants more laborers to be hired.
It is more common to hear of subsidies provided for laborers,
agriculture, housing, and other industries. On the other hand,
subsidies given to the arts or cultural sector are not as
controversial, and are commonly given when there is insufficient
support from the private sector. Subsidies are protectionist and
serve as trade barriers because they work in favor of
strengthening domestic commodities and services. As such, they
may cause market distortion. This is the case, particularly in
first world countries where farm subsidies are prioritized.
Because of this, surplus commodities are then dumped in
developing countries, thus becoming a bur