EcoGeek has an article up which summarizes the findings of a Prometheus Institute report, and the conclusion is that solar panels will plummet in cost due to coming oversupplies of silicon, which is currently in short supply. However, the article turns bizarre when the authors insert this editorial comment in the last paragraph:
It may also, though this is probably wishful thinking, push governments to start offering more incentives to those who install solar in a bid to use up the remaining capacity and financially support their manufacturers who by this point will be a very large industry, employing tens of thousands of people.
First of all, one of the benefits of falling prices is precisely the opposite of what the author wants to happen: solar panels might become competitive without the need for subsidies, which would free them from the vagaries of politics. It would blunt any criticism of green technology as government waste, since government would no longer be propping it up. But, to add insult to injury, the cure that they prescribe seems worse than the disease: by propping up the sector, the government would remove the incentives to innovate, and increase the jockeying among solar panel companies for public funds. It could possibly be one of the worst things that the government could do to an infant industry – distort the price mechanism and incentives faced, and ensure that the industry will forever be dependent on the whims of those who hold the pursestrings in Washington. And the "labor-friendly" overtones of supporting industries that create jobs smacks of the techniques that the manufacturing and auto unions used to ensure their own demise, or the increasingly perverse farm subsidies to support a way of life that's long gone despite the money lavished on farmers.