The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Transfer Payments

  • Robert J. Lampman
Reference work entry


A transfer transaction is unlike an exchange transaction. The latter, which is the main concern of market economists, involves two trading partners both of whom give up something of value in search of mutual gain. The former involves a donor and a recipient, with the donor giving up something of value without receiving anything in return. Transfers can be made between one person and another or from one organization such as a government to another. The transaction can be explicit as in the case of a stated gift to a certain person or quite diffuse as in the case of a subsidy to anyone who produces or consumes a specific consumer good. Transfers, which may take the form of income or wealth, can be voluntary or involuntary and may be motivated either by altruism of the donor of malevolence of the recipient.

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Robert J. Lampman
    • 1
  1. 1.