How is the OECD supporting a more level playing field?
While subsidies can be helpful policy tools for addressing emergencies or market failures - where other instruments are less effective or appropriate - they can also distort trade and competition depending on their design and target. Much like doping in sports, government support can give some firms a leg-up on their competitors that is not grounded in economic or market forces, but instead in the generosity of the government supporting them. This undermines fair competition and the willingness of economies to accept the results of that competition. Support may in turn push other countries to respond in kind, to the detriment of consumers, taxpayers, and other governments that do not have sufficient fiscal space, ultimately undermining public support for, and confidence in, an interconnected global economy.