Governments also frequently subsidize local industries to help them compete in the global market. Subsidies come
tax credits or direct payments. The most commonly used are farm subsidies. That allows producers to lower the price of local goods and services. This
the products cheaper
when shipped overseas. Subsidies work even better than tariffs. This method works best for countries that rely mainly on exports.
sometimes subsidies can have the opposite effect. The Agricultural Adjustment Act of 1933 allowed the government to pay farmers
to grow crops or livestock, which let their fields rest and regain nutrients. It helped the agriculture industry but raised food costs during the Depression.