Question

The authors explains that subsidies are the opposite of taxes. Recently, some members of Congress proposed large subsidies for education, including some calls for 100% subsidies that would cover the full cost of college education. What impact would these subsidy programs have on the quantity of college education demanded by US residents? Would this type of subsidy also destroy wealth in the US economy? explain your response.

Answer 1

Education is most important for any country in the globe. It does not only increase the percentage of literacy and it also plays a greater role for future economic growth. So, the government can give subsidy completely on education because of considering the future economy. Nowadays, so many developed countries we have like Switzerland, China, Singapore etc. These are all the nations done a greater part of encouraging literacy in past decades and enjoy the fruits now in terms of their growth leads to great help for economic growth. So, the US residents demanding a subsidy of a college education is really to consider a great cause of action for future economic growth.

The government will consider this subsidy on education and give good hope for all the US residents with 100%. According to the authors, subsidies are the opposite of tax really but they need to think about the future economic growth of US. It’s possible by only in the hands of literate people in the US when the college education got 100% subsidies. Moreover, this subsidy will show short term negative impact on the economy but it is not an issue to continue for the long term. This will help to the create a great path for future economic prospects. After observing the all above things, the subsidy will not destroy the US economic wealth and moreover, it will help to the future economic growth.