Disadvantages to domestic industries in the long run

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Governments sometimes provide price subsidies to specific industries; that is, they reduce a domestic firm's costs so that it can sell products on the international market at a lower price.

What reasons do governments (and politicians) use for these government subsidies?

What are the benefits and disadvantages to domestic industries in the long run? To international customers? Who would benefit and who would lose if all price subsidies were eliminated?

Reference no: EM131285666

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