Subsidies in France

Throughout this blog, I make the point that management problems are complex. If we fail to understand that complexity, we will make decisions that have side effects. My father, who lives in France, told me the following story a few days ago. In order to develop green energy in France, the French government now gives subsidies that reduce the cost of installing sun panels by 50%. Before the subsidy; sun panels cost about Euros 3,000. After the subsidy started, the price of installing solar panels jumped to Euros 5,600 !