What does it mean to subsidize in an economic context?

In an economic context, to subsidize means to support an entity, activity, or economic sector by providing financial aid. This often involves a government or an organization providing funds to lower the cost of production, goods, or services, making them more affordable for consumers or helping businesses become more competitive. By offering such financial assistance, subsidies aim to encourage certain activities, support public welfare, or stimulate economic growth in specific industries, such as agriculture, education, or renewable energy.

While selling products at a lower price, investing in technology, or disrupting market balance may have their significance in economics, they do not capture the essence of what subsidizing involves. Subsidizing specifically focuses on the act of providing financial aid or support to help offset costs and promote specific economic outcomes.