In this article, we propose to calculate the size of the population living in poverty,
measured through uni- and multidimensional poverty indices, and the Gini coefficient
using extended full (time plus money and informal earnings) incomes, from cross-sectional
data covering 2003–2006 in Turkey. Thus, monetary incomes are corrected by adding the
earnings gathered from informal activities and the monetary values of time spent in
domestic activities into declared incomes, producing an error-free estimate of the size of
the population living in poverty and the Gini ratio overall. To show the effect informal
activities with the domestic ones have on poverty, changes in the joint probability of being
in informal activity while being considered poor is measured by means of a bivariate probit
model using extended (money plus informal earnings) income and extended full incomes.