Overdependence on government subsidies

Experimental visualization of narrower problems
Other Names:
Discriminatory domestic subsidies

A wide variety of techniques is used by governments to subsidize production costs. They may be grouped as subsidies to specific industries, as regional development programmes, or as subsidies for particular economic activities (which seek to raise growth rates in broad groups of industries, to bring about significant structural adjustments, and to facilitate the adjustment of enterprises to economic shocks). Such government aids to domestic industries result in some degree of distortion of trade patterns. Some of these forms of aid may represent efforts either to offset tariff and other trade concessions or to improve balance of payments positions.


State subsidies in the EC were about 82 billion ecus a year in 1986-88. Of that, agriculture took an average of 11 billion ecus a year, coal 13 billion, railways 26 billion, and industry the remainder. In 1981-86, subsidies were around 89 billion ecu a year.

Related UN Sustainable Development Goals:
GOAL 16: Peace and Justice Strong Institutions
Problem Type:
D: Detailed problems
Date of last update
30.04.2022 – 06:05 CEST