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Read the following passage, then... - Soal SKB No.55

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TBI PKN STAN - Paket 03 SELEKSI-LANJUTAN-SEKDIN TBI - Reading Comprehension

55. Read the following passage, then answer the question below.

Subsidy reform is often described by economists as a straightforward matter of correcting price distortions, yet its political economy proves considerably more intricate. Subsidies, once introduced, tend to generate concentrated beneficiary groups whose losses from reform are highly visible and immediate, whereas the diffuse gains accruing to the broader public from reduced fiscal burden are less perceptible and slower to materialize. This asymmetry creates a structural incentive for organized resistance that frequently outweighs the latent, unorganized support for reform. Governments that have successfully navigated subsidy removal have typically done so not by relying on the technical merits of the policy alone, but by pairing reform with targeted compensation mechanisms that soften the transition for the most affected groups, thereby narrowing the gap between visible losses and invisible gains that fuels opposition.

What is the author's implied recommendation for governments considering subsidy reform?

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