Discuss whether or not a government should subsidise bus transport.
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it may encourage a rise in bus travel
It may reduce poverty / redistribute income
The poor tend to use buses more than the rich
Better quality travel
Bus travel creates fewer external costs than car travel
Reduce pollution
Reduce traffic congestion
Increase employment / reduce unemployment
Increase labour mobility
It will involve an opportunity cost
The government might instead spend more on e.g. education / raise taxes
Bus companies may not pass on the subsidy to passengers
Subsidies may make bus companies complacent
Not try to keep their costs low
May not improve quality
Rail transport may be more efficient
May provide more social benefits
Explanation:
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