Hardware subsidies used to be commonplace policy tools for expanding sanitation access in rural areas. Overtime, however, hardware subsidies were found to produce distortionary effects on sanitation markets and failed to achieve sustained latrine usage and hygienic behaviors, and therefore declined in popularity in the mid-2000s.
However, “no subsidy” approaches are not sufficient either, in improving sanitation outcomes. This review, produced by USAID’s WASHPaLS #2 project, seeks to contribute to understanding of new, “smart” subsidies that improve upon their predecessors, and identify gaps in current knowledge so that implementers and governments can effectively incorporate subsidies into their sanitation toolkit. The review seeks, specifically, to understand how this approach can support poor and vulnerable households in adopting sustainable sanitation behaviors well into the future.