Directions: Read the passage given below and answer the questions that follow by choosing the correct/most appropriate options:

When the then Tamil Nadu Chief Minister M.G. Ramachandran launched his now-famous mid-day meal scheme in 1982, it met with opposition both within his own party, the All India Anna Dravida Munnetra Kazhagam (AIADMK), and the Opposition. Within the party, there were concerns that it would result in leakages and corruption. The Opposition said it was intended mostly to bolster his personal image among the poor. Parents saw merit in sending their children regularly to school. As a result, attendance at schools shot up. The benefits thus went beyond the immediate objective of providing adequate nutrition to children.

The success of the scheme illustrates a broader point. It is hard to capture the total welfare effects of a given scheme at the outset and, therefore, hard to evaluate the merit of a given freebie (a word used to describe subsidized consumption). Bicycles for children may look like a cheap electoral bribe. But those familiar with rural areas would know that poor transport is a serious obstacle to attending school or college. Television sets may not be about recreation, they could be vehicles for imparting useful information or they could simply bring the family together, both of which have wider benefits for society.

Economists make a distinction between ‘merit’ goods and ‘non-merit’ goods. Merit goods, such as education and health care, have positive externalities, that is, the public benefit exceeds the private benefit. Such goods are worth subsidizing. Not so ‘non-merit’ goods. But what is ‘merit’ or ‘non-merit’ is not always readily discernible. With their acute appreciation of grassroots realities, politicians often have a better understanding than economists do of the ‘merit’ underlying certain freebies. They have a much better grasp of what it takes to change the lives of the disadvantaged or to bring about social transformation.