Economics of Subsidy
25 Pages Posted: 26 May 2006
Date Written: December 2005
Subsidy as a manipulative support system is structured in a country by way of fiscal law relating to macro-economic management through the budgetary process. It is that branch of International Trade Law, fact file of which lies in pure economics. International trade lawyers, intellectuals, politicians and economists view subsidy from different perspectives. Subsidy is a protectionist device, on account of political economic compulsion, is a trade distortion mechanism and many more. Some identify subsidy as a mechanism to enforce equality but subsidy remains essentially a paradigm driven by economics. Thus economics of subsidy should entail all elements of legalism. The complexities involved in this branch of study squarely relates to fore corners of subsidy definition.
Keywords: subsidy, WTO, USA, India, Economics
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