A subsidy is a payment from a government to a producer. Often this producer produces something that is either seen to be of benefit to society (i.e. it increases GDP growth) or its production or operation is meant to decrease a negative externality.
Traffic causes congestion and pollution. The worst of this is in towns or "urban conurbations". Electric cars do not pollute "roadside", but probably "offside" or "countryside" because that is where fossil fuels are burnt to generate the electricity that powers them. Nevertheless, the UK government have decided to subsidise nine models of electric car as of January 2010. What are the advantages and disadvantages of this policy? Click on the image below for the video from the BBC.
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