Question

Which of the following is not a transfer payment? Social Security disability unemployment subsidies

Answer 1

Subsides would be the answer because all of them due with receiving money from a unemployment provider

Answer 2

The correct answer is: "subsidies".

Transfers are defined as payments, which are usually part of goverment income redistribution programs and which are delivered without expecting any provision of goods, services or factors in return. Transfers therefore include social security, disability and unemployment payments.

On the contrary, subsidies are money sums granted by the authorities to economic agents for undertaking a specific activity, project, etc. For example, subsidies are granted to firms that show commitment with the environment and are adapting their production systems so that they pollute less.