International Trade and Subsidies: Examining Effects on Key Industries

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Added on 2024/07/03

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This essay provides an analysis of subsidies across three key sectors: agriculture, the car industry, and solar/wind energy. In agriculture, subsidies are defined as financial support from the government to farmers, aiming to maintain the balance of supply and demand, with the positive aspect of reducing the need for food grain imports, but with the negative impact of government intervention. Car industry subsidies are government assistance to keep car prices economical for consumers, which helps consumers buy more cars, but can negatively impact domestic car dealers and increase car imports. Solar and wind energy subsidies aim to reduce costs and encourage renewable energy adoption, providing economic and environmental benefits, but at times leading to energy wastage and environmental harm. The essay references academic sources to support its analysis of the multifaceted impacts of these subsidies on international trade and domestic markets. Desklib provides access to similar essays and study resources for students.

International Trade and
Enterprise

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Agricultural Subsidy
It is the grant or financial help which is offered
by the government to support the farmers or
the people who are running and managing
agriculture business. The agriculture subsidy
helps in maintaining the demand and supply of
agriculture commodities

Positive and negative aspect of agricultural
subsidy
Positive
• Agricultural subsidies helps in
reducing the requirement of
importing the food grains
Negative
• Due to the agricultural
subsidies there is government
interventions in the
agriculture

Subsidies in Car Industry
Subsidies in the car industry is the financial
assistance which is offered by the government in
order to maintain the supply of the car and to
cut down the extra cost which is borne by the
consumers while buying the car.

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Positive and negative aspect of car industry
subsidy
Positive
• This helps the consumers to buy
more cars as they need to pay
economic prices
Negative
• The subsidies which are offered
by the government impacted the
domestic car dealers and
resulted in an increase in the
imported cars

Subsidies in Solar/ Wind energy
The subsides in the solar and wind energies are
the measures which aid in cutting down the
cost. Solar energy or wind subsidies are
considered to be the direct cash allocations to
consumers

Positive and negative aspect of Solar/ wind
energy subsidy
Positive
• Subsides in the renewable
energies assist in economic
and environmental benefits
Negative
• At times the subsidies can led
to the wastage of energies
and can harm the
environment

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References
• Sovacool, B. K. (2017). Reviewing, reforming, and rethinking
global energy subsidies: towards a political economy research
agenda. Ecological economics, 135, 150-163.
• Hemming, D. J., Chirwa, E. W., Dorward, A., Ruffhead, H. J.,
Hill, R., Osborn, J., & Phillips, D. (2018). Agricultural input
subsidies for improving productivity, farm income,
consumer. Campbell Systematic Reviews, 4.
• Harrison, G., & Thiel, C. (2017). Policy insights and modelling
challenges: The case of passenger car powertrain technology
transition in the European Union. European Transport
Research Review, 9(3), 37.