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Government Subsidies for Training Provision

Question

Discuss whether a government should subsidise the provision of training.

Category:

Taxes and subsidies

Frequently asked question

Preview Answer

I. 🍃Introduction
- Definition of training and its importance in the economy
- Brief overview of the arguments for and against subsidizing training

II. Arguments for subsidizing training
- Improved labour productivity leading to economic growth
- Improved quality of output leading to increased demand for products
- Increased skills of workers leading to reduced unemployment and government spending
- Job creation for teachers/trainers leading to reduced unemployment
- Reduced costs of production leading to reduced inflationary pressure and increased international competitiveness

III. Arguments against subsidizing training
- Workers should pay for their own training to increase their employment chances and earn higher wages
- Opportunity cost of subsidizing training
- Risk of trained workers emigrating for better paid jobs in other countries
- Firms should pay for training as they may receive benefits in the form of lower costs and increased profitability
- Training is a long-term solution with time and output lost during training

IV. 👉Conclusion
- Summary of arguments for and against subsidizing training
- Personal opinion on the issue
- Final thoughts on the importance of training in the economy.

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