Transfers and Related Inter-sector Flows

Abstract

Transfers consist in the surrender of claims to product by one person or institution to another without there being any quid pro quo. They increase the income, and thus the wealth, of the transferees (i.e. the recipients of the transfers) and reduce that of the transferors (i.e. those who make the transfers). Their basic function is thus seen to be the redistribution of income and wealth. Most transfers shown in the accounts, such as taxes on income and profit, unemployment benefits, family allowances, etc. are obligatory payments from one person or institution to another. Transfers that are not of an obligatory nature, such as gifts made by persons to one another and to charities, are for the most part intra-sector transfers and as such do not show up in the accounts.