Intentional Subsidies

Summary

Market actors may need to have their risk reduced in order to change behavior. In one clean energy program in Timor Leste, Mercy Corps worked to improve energy services and reduce household energy costs by promoting solar lanterns and improved cookstoves. We provided a 50% cash subsidy to 26 micro and small businesses to purchase their initial stock of clean energy products. By the program’s end, 25 of these initial 26 businesses had reinvested capital into additional product stock.