Subsidy is defined as money that is paid by a government or an organization to reduce the cost of producing goods and services so that their prices can be kept low (Hornby, 2005: 1476).In his own understanding of subsidy, Agu (2009:286), saw it as a payment made by government to producers of certain good and services, to enable them produce and sell at lower prices than they would otherwise.
Agu was of the view that policy helps to lower the market prices below the factor costs, so that consumers would have the privilege to pay use for the goods and services than they cost the producer to produce same.
In the same vein, Ezeagba(2005) believed that subsidy exits in a situation when consumers of a particular commodity in question. Ezeagba (2005) saw subsidy on the producers’ side: He saw it as the payment to producers of certain commodities by the government not to produce the prices of their product are less than breakeven point.
In his own definition of the concept, Ovaga (2010), stated that it is a device employed by government to assist either the consumers or producers to consume or produce certain commodities at prices below the prevailing market prices. According to Him, it is also an incentive given to either side (consumers or producers) to consume or produce more of the goods and services.
Todaro (1980), in his own understanding of subsidy, saw the importance of applying it in education sector for the less privilege ones in the society. He was of the view that low income groups should be provided with sufficient subsidies to permit them to overcome the sizeable cost of schooling. The essence of the policy in this circumstance is to reduce the cost of education for the less privilege ones, therefore encouraging them to avail themselves the opportunity of benefitting from the benevolence of the government.
Ruffin and Gregory (1983), saw subsidy as a vital instrument for economic development and growth in a country. They said, when a foreign government subsidizes its exports, the ultimate beneficiaries are citizens of the country. For instance, United State, which in 1970s had comparative advantage in commercial aircraft, subsidized the export of this very product, through market loans to the being and McDonnell Douglas Corporation. It is the light of the above that the writers claimed that foreign export duties are gifts to the American people.
Agu was of the view that policy helps to lower the market prices below the factor costs, so that consumers would have the privilege to pay use for the goods and services than they cost the producer to produce same.
In the same vein, Ezeagba(2005) believed that subsidy exits in a situation when consumers of a particular commodity in question. Ezeagba (2005) saw subsidy on the producers’ side: He saw it as the payment to producers of certain commodities by the government not to produce the prices of their product are less than breakeven point.
In his own definition of the concept, Ovaga (2010), stated that it is a device employed by government to assist either the consumers or producers to consume or produce certain commodities at prices below the prevailing market prices. According to Him, it is also an incentive given to either side (consumers or producers) to consume or produce more of the goods and services.
Todaro (1980), in his own understanding of subsidy, saw the importance of applying it in education sector for the less privilege ones in the society. He was of the view that low income groups should be provided with sufficient subsidies to permit them to overcome the sizeable cost of schooling. The essence of the policy in this circumstance is to reduce the cost of education for the less privilege ones, therefore encouraging them to avail themselves the opportunity of benefitting from the benevolence of the government.
Ruffin and Gregory (1983), saw subsidy as a vital instrument for economic development and growth in a country. They said, when a foreign government subsidizes its exports, the ultimate beneficiaries are citizens of the country. For instance, United State, which in 1970s had comparative advantage in commercial aircraft, subsidized the export of this very product, through market loans to the being and McDonnell Douglas Corporation. It is the light of the above that the writers claimed that foreign export duties are gifts to the American people.
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