A subsidy is a government payment or incentive provided to a business or industry with the aim of promoting employment, economic growth, or specific outcomes. It can involve direct financial assistance, tax breaks, or reduced costs for inputs. The purpose of a subsidy is to encourage the growth or development of a particular sector or to offset the costs of specific activities. Subsidies can be provided for various purposes, such as supporting renewable energy projects, promoting agricultural production, or fostering innovation in a specific industry.