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The Contribution of Gifts to the Household Economy of Low-Income Families

Measurements of income at the household level have traditionally only recorded income received by household members. This has generally been reflected in qualitative research. However, using interview data from two studies of British mothers and children on low incomes, we find that for some, cash and in-kind transfers from family and friends outside the household form a significant proportion of household income. In some cases, income is doubled once gifts are included. Thus, gifts make a substantial contribution to living standards, both quantitatively and qualitatively. The implications of this finding for income measurement are discussed, and further research is recommended.