But from the perspective of the government, the asset has already outlived its usefulness. Every further use (regardless of scrapping) of the car is perceived a

But from the perspective of the government, the asset has already outlived its usefulness. Every further use (regardless of scrapping) of the car is perceived as pure loss. This may be different from the owner who may be unable to buy a new car, or who sees an individual gain. The subsidy aligns the perspective of the owner and of the government.