Paying for Pilgrimages

Many nations provide hidden or direct subsidies for activities by arguing that these activities have special value or under the infant industry argument. This article under the Reuters Africa news service states here that the government of Nigeria will scrap all subsidies for religious pilgrimages. Why any government should pay for any adherent to visit a holy site beats me.

Economic theory states that subsidies are almost always inefficient because they lead to the overproduction and consumption of goods or services beyond a level that would be cleared by the market mechanism. For this reason, subsidies lead to unintended consequences while distributing income and constraining the proper use of the money.

So one must support the abolition of the subsidies and stress that their withdrawal ought not to be justified only on grounds of high costs to the treasury. Public money ought not be used to support purely religious activities in a republic. With respect to the future pilgrims, their trips ought to be paid for by the consumer of that undeniably important service. This would allow for the theory of revealed preference to be tested. The pilgrimages must go on but the 25% subsidy should not even have been initiated in the first instance. Good decision by that government.