During 2009 farmers were paid $61million per month in drought assistance as part of Exceptional Circumstances Subsidies. But the public got nothing for it. I have often said that public subsidies, even in a crisis, should always come with obligations. The simplest of all is to make the subsidy an asset swap rather than a gift—provide the cash, but take an equity stake in exchange, diluting ownership. This 'equity mate' public policy can help ensure the continuity of productive capacity during crisis periods.
Economic crisis? How about ‘equity mate’?
Economic crisis? How about ‘equity mate’?
Economic crisis? How about ‘equity mate’?
During 2009 farmers were paid $61million per month in drought assistance as part of Exceptional Circumstances Subsidies. But the public got nothing for it. I have often said that public subsidies, even in a crisis, should always come with obligations. The simplest of all is to make the subsidy an asset swap rather than a gift—provide the cash, but take an equity stake in exchange, diluting ownership. This 'equity mate' public policy can help ensure the continuity of productive capacity during crisis periods.