- In-kind Subsidies (similar to Price Subsidies):
- Provide specific goods or services directly.
- Can ensure access to essential items.
- Often suffer from leakages, diversion, and market distortions.
- May not be efficient in resource allocation.
- Direct Cash Transfers (DBT and Income Support):
- Provide money directly to beneficiaries.
- Increase effectiveness by reducing administrative costs and leakages.
- Empower beneficiaries to choose how to spend.
- Can free up markets and boost long-run growth.
- Generally considered more efficient and transparent.