Subsidy receipts, spending and distribution
도입됨| English | 의미 |
|---|---|
| public expenditure/ˈpʌblɪk ekˈspendɪtʃə/ | 공적 지출 |
| subsidy incidence/ˈsʌbsɪdi ˈɪnsɪdəns/ | 보조금 귀착 |
A decision you can investigate
- A public payment supports suppliers, while competition can also lower the price buyers pay.
- The recipient of the cheque need not receive the entire economic benefit.
Build the explanation
- A per-unit subsidy creates a reverse wedge: seller receipt Ps equals buyer price Pb plus subsidy s. Supply responds to the receipt; demand responds to the paid price. Public expenditure 公共支出 is s times eligible post-subsidy output.
- The benefit split depends on relative responsiveness. Less elastic demand can give consumers more of the price benefit; less elastic supply can leave more with producers. Market power, eligibility and contract terms can change the simple model.
Work through the evidence
- Use the original Qd=120−2P and Qs=2P, with P=30,Q=60. Subsidy 12 gives Ps=Pb+12. Set 120−2Pb=2(Pb+12): Pb=24, Ps=36,Q=72.
- Buyers save 6 per unit and sellers gain 6 in receipt. Public cost = 12 × 72 = 864. CS=½ × 36 × 72=1296 and PS=½ × 36 × 72=1296. Net of the public payment, gains are 2592−864=1728, below original 1800 in this no-external-benefit model. More trades alone do not establish greater net welfare.
What price does the buyer pay after this subsidy?
난이도 1/5 · 100 코인 + 오늘 첫 완료 시 소액 보너스
Demand and subsidized supply intersect at buyer price 24.
What is public cost under the stated eligibility?
난이도 1/5 · 100 코인 + 오늘 첫 완료 시 소액 보너스
All 72 units receive 12: 864.
A subsidy paid to sellers can lower the price paid by buyers as well as raise sellers’ receipts.
난이도 1/5 · 100 코인 + 오늘 첫 완료 시 소액 보너스
True. The market price adjusts, so the benefit of a subsidy is shared between buyers and sellers according to the elasticities.
Test the limits
- The equal benefit split is specific to the symmetric curves. A subsidy addressing external benefits may move output closer to the social optimum instead of creating inefficient extra output.
- Public funds have alternative uses. Funding, targeting, fraud risk and administrative costs matter. A producer subsidy is not the same as handing every consumer the same cash sum; show both prices and the output actually supported.
Why are larger private surplus areas insufficient to prove a net welfare gain?
난이도 1/5 · 100 코인 + 오늘 첫 완료 시 소액 보너스
The comparison must include funding and external effects, not just private gains.
Apply and explain your answer
- Why is a subsidy paid on all 72 units costlier than paying only for the 12 extra units?
- The stated eligibility covers all post-subsidy output, including units that would already have been supplied.
Match the terms to their meanings.
난이도 2/5 · 140 코인 + 오늘 첫 완료 시 소액 보너스
Use each term for its stated economic relationship.
Use the terms precisely
- subsidy incidence 补贴收益归宿: The distribution of a subsidy’s economic benefit between market participants.
- public expenditure: Spending by government on services, transfers or other activity.
Use the original Qd=120−2P and Qs=2P, with P=30,Q=60. Subsidy 12 gives Ps=Pb+12. Set 120−2Pb=2(Pb+12): Pb=24, Ps=36,Q=72. Buyers save 6 per unit and sellers gain 6 in receipt. Public cost = 12 × 72 = 864. CS=½ × 36 × 72=1296 and PS=½ × 36 × 72=1296. Net of the public payment, gains are 2592−864=1728, below original 1800 in this no-external-benefit model. More trades alone do not establish greater net welfare.
The equal benefit split is specific to the symmetric curves. A subsidy addressing external benefits may move output closer to the social optimum instead of creating inefficient extra output. Public funds have alternative uses. Funding, targeting, fraud risk and administrative costs matter. A producer subsidy is not the same as handing every consumer the same cash sum; show both prices and the output actually supported.
A per-unit subsidy creates a reverse wedge: seller receipt Ps equals buyer price Pb plus subsidy s. Supply responds to the receipt; demand responds to the paid price. Public expenditure is s times eligible post-subsidy output.
Write from a subsidy of 10
- Use Qd = 100 - P and Qs = P, then a per-unit subsidy of 10.
- The seller receipt equals the buyer price plus 10. Explain why the public cost covers all 55 units, not only the extra 5.
Demand is Qd = 100 - P and supply is Qs = P. A subsidy of 10 makes the seller receipt equal to the buyer price plus 10. Find the prices, the quantity and the public cost.
The wedge is added to the seller's receipt. Eligibility in this model is all post-subsidy output.
Why does the subsidy cost 550 rather than 50?
난이도 1/5 · 100 코인 + 오늘 첫 완료 시 소액 보너스
10 times 55 is 550. The extra output is only 5 units, but the rule pays for the units that would have been sold anyway.