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subsidize

SUB-suh-dyz /ˈsʌb.sɪ.daɪz/

verbB2IELTSTOEFLGMAT

formaleconomic

To support an organization, activity, or individual financially by paying part of the cost.

Implies offset funding from a government or larger institution to lower prices or encourage production of a specific public good.

The story behind the word. In ancient Rome, 'subsidium' referred to military reserves stationed behind the front line — literally soldiers 'sitting beneath' or in reserve to support troops in trouble. In modern English, this idea of back-up reserve support shifted to financial reserves used to prop up essential industries.

Word relationships

underwrite: Underwrite implies assuming financial responsibility or guaranteeing against loss, while subsidize means providing direct financial reduction of costs.
fund: Fund means providing capital generally, whereas subsidize specifically means paying a portion to make something cheaper or accessible.

tax: Taxing adds an economic burden to an activity, whereas subsidizing lightens its financial burden.

Commonly confused with

invest: Investing expects a direct financial yield or profit return, whereas subsidizing seeks social or market outcomes without expecting financial returns.

Word family

subsidy (noun): A sum of money granted by the state to assist an industry or enterprise.
subsidization (noun): The act or process of subsidizing.

Collocations

heavily subsidize
subsidize housing
government-subsidized
subsidize production

Example sentences

"The city council decided to subsidize public transit fares to encourage commuters to leave their cars at home." Public Transit
"Federal programs subsidize crop insurance for small family farms facing climate instability." Agricultural Policy

Memory hook

Sub = under; think of money sitting UNDER an industry to hold up its foundation. Support sitting beneath.

When not to use

Do not use when someone pays the full cost or purchases a service directly; it must involve offsetting expenses.

Fun facts

Renewable energy and oil industries are among the most heavily subsidized sectors in modern global economics.