The final products and services produced with the introduction of the internal resources of the power during a given period of time. GNP determines the value of products made by factors of production that are owned by the citizens of this power, including in the territory of other states.

GNP characterizes both a single cost and a single profit in the economy.

The gross state product is considered to be the earliest indication of GDP. It should be noted that GNP is used in the statistics of a number of foreign countries to this day.

GNP reflects the consequences of work in two areas of the ethnic economy of material production and services. It characterizes the cost of the entire volume of final production of goods and services in the economy for 1 year (quarter, month). The sign is calculated in the cost of both current (working) and constant (tariffs of some base year).

The difference between GNP and GDP

• GDP is calculated according to the so-called territorial indicator. This is the total price of products of the spheres of material production and the field of activity, regardless of the nationality of the companies located in the territory of this power;

• GNP is oriented as the market price of all final goods and services made in the economy in a year. With all this, the annual size of the final products and services created by the inhabitants of the state is provided, both on the scale of the state territory and abroad.

Another definition of GNP is the necessary amount of earnings of companies, organizations, population in material and intangible production. GNP also takes into account depreciation deductions that will arise as a result of adding part of the price of used products (machines, machines, etc.) to finished products. As for GDP, for a correct calculation of GNP, all products and proposals completed this year must be taken into account 1 time.

Thus, GNP differs from GDP by the required amount of so-called factor earnings from the use of the resources of this power abroad, transferred to the country of money invested abroad, belongings there, the salary of people working abroad minus similar profits of foreigners exported from the power. Traditionally, in order to calculate GNP, the difference between the profits and earnings acquired by enterprises and individuals of this power abroad, on the one hand, and the profits and earnings acquired by foreign investors and foreign employees in this country, on the other hand, is added to the GDP indicator.

This difference is very small: for the main Western countries it is less than ±1% of GDP. The UN Statistical Service advises adopting the GDP indicator as the main feature.

Calculation of the Gross State Product (GNP)

Thus, in order to obtain the gross state product, it is necessary to add to GDP the difference between the income from factors of production (factor earnings) due to the border and the factor earnings of non-residents in this country. Residents are all persons living in the territory of this power, not counting foreigners who come to it for a period of at least a year.

For example, after calculating the gross domestic product of Estonia for a certain period, it is necessary to add factorial profits from Estonian firms located in other states to it, and take away the profits of firms from other states located on the territory of the republic. The quantitative difference between the gross domestic product is insignificant and in developed countries does not exceed 2%.

GNP can be represented as PQ, where the sign P is the level of prices, and the sign Q is the amount of real material amenities and services that are legally sold and provided. As it follows, natural production, natural exchange (barter), black goods are usually not reflected in the gross product.

Accounting for the Gross State Product (GNP)

The gross product includes only end-use goods at the cost of final buyers.

• These include, firstly, products and offers purchased by households for their own use and, secondly, investment products. Also, end-use goods include all purchases by municipalities and exports of products abroad.

• Own-use goods include the goods of daily use and long-term use: food, clothing, household appliances, etc.

• Investment products contain all construction. Similarly, such goods include purchases of production equipment.

• All municipal purchases of products, services, and construction requests are treated as end-use products.

The creation, sale, purchase of end-use products are productive transactions. As follows, these transactions increase the gross product. Unproductive transactions are not provided for in GNP.

The gross product takes into account only the final goods produced in a certain period of time, for example, in a year. As it follows, everything that was done in the past year cannot be taken into account again this year. In addition to all this, you should take into account the produced product 1 time. Eliminate the sale and sale of old things that have already been provided for before. In this year's GNP, for example, a car produced in the same year will be taken into account, although an old car that is resold will not be taken into account in the GNP. The product is considered sold as soon as it is purchased by the final buyer.

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To determine the state of economic well-being of the country, there are a significant number of different criteria by which the country's macroeconomic indicators are compiled. There are those that relate to psychological, social and other. But in this article, only those that indicate the level of economic prosperity are of interest, or rather, two of them: gross domestic product and gross national product. And the main question: what is the difference between GDP and GNP? In most countries of the world, these figures do not differ much from each other. But there is a difference between them, and it should be within the framework of the article to find out how much the values ​​differ when calculating, why they are calculated and, finally, what is the meaning of these parameters, and what are macroeconomic indicators in general.

What

Gross domestic product means the total value of all material goods produced and services rendered that were provided and brought into a state of readiness for sale. Moreover, products made within the borders of a certain country are taken into account. This is the main difference between GDP and GNP. The calculation is carried out in nominal banknotes. But conditions should be taken into account, because sometimes products can be taken into account in GDP, and sometimes they cannot.

An example of calculating GDP

So, if there is a certain plant that produces semi-finished products and exports them abroad, then the total value of the semi-finished products produced by the enterprise will be added to the gross domestic product. But if the plant uses them in the future itself to manufacture more advanced and necessary products that will be exported, then the value of the GDP will be added to the value of the further product (the most final, ready for external sale). It should be said separately about what real and nominal GDP / GNP are. The second is what is currently available, while the first is what should be the result of dividing GNP by the general price level. Pretty confusing for a layman. The main difference that needs to be understood when studying GDP and GNP is in the territorial aspect of the calculation.

What is gross national product

The gross national product is understood as the total value of material goods and services that were produced and provided by representatives of one people throughout the entire Earth. Compared to calculating the gross domestic product, it is more laborious and gives only a relative idea of ​​the standard of living. This is all due to the use of funds: for example, if a person moved to another country and started a business there, the GNP takes into account the income that he brings to the state, but this income he brings in a completely different way, from which his homeland does not receive direct taxes and investments in the economy . A workaround is possible, when money earned abroad will be transferred to the homeland, but even this option is not optimal in terms of using human potential. How GDP differs from GNP, at this stage it should already be clear, if not, you need to read the two previous paragraphs.

How is GDP calculated?

Gross domestic product for a certain year is calculated in this way: the market value of all products produced by the country in a certain monetary expression, which is ready for sale and use outside the enterprise that manufactured it, is summed up. Here we should digress and talk about the so-called positive shadow sector of the economy. Calculating the real gross national product of a country is very problematic.

Positive shadow GDP

Usually, from TV screens, newspaper pages, on the radio, on the Internet, you can find out that the shadow sector is always bad. But only illiterate people can say that. Let's give an example: you have a garden for ten acres, and it was planted with potatoes, carrots, radishes, herbs and other crops. The time has passed, the time has come to harvest. Vegetables harvested from the plots do not openly go into the gross domestic product, therefore, purely technically, this is part of the shadow sector of the economy - production without taxes. But it is grown, as a rule, for their own use, does not harm society, but can only reduce the profits of individual entrepreneurs. It is from such situations that the positive shadow sector of the economy consists. Why was this said? The fact is that in different countries of the world there have been and, perhaps, there will still be attempts to define the boundaries of this sector and add it to the gross domestic product (or gross national product), but so far, due to the impossibility of obtaining accurate data on the volume of work, such a calculation is not is underway. Measurement of GDP and GNP is carried out in local currencies for "their" investors, and in US dollars for reporting data to international ones. Conversion is carried out at the official exchange rate.

How is GNP calculated?

The gross national product is calculated according to the data provided by people who have citizenship of a certain country, or, if there is a division into nations (provided in passports), then based on the income of representatives of one nation. Such a calculation method is necessary to obtain information about the state of the state-forming masses as a reason for judging the state of affairs in the state itself.

Who calculates gross domestic product?

GDP is calculated by two organizational forms: private and public. The tax, customs services, various statistics committees help the state to collect the required information. The information they collect is pretty accurate. But there are a number of pitfalls here that spoil the state statistics. Among them: the submission of false data by managers or owners of enterprises, the deliberate falsification of data by the government or its subordinate structures. In world practice, it has been noted that owners of enterprises in capitalist countries have a tendency to reduce data, and managers in countries with a significant public sector, like in China, are interested in increasing indicators, where scandals arise over and over again about enterprises overestimating their profitability and turnover.

How do private structures think?

Private structures operate in other ways. They carry out the calculation on the basis of official data, but at the same time, they check the data provided by other states on the amount of turnover, check with the data of banking institutions, other private structures that have access to the information of the required type, and on the basis of a comprehensive assessment, they are already making their own conclusions about the value of the gross domestic product and present their subjective judgments about the correspondence of government data to the real state of affairs. The calculation of GDP and GNP is carried out by them in order to provide additional confirmation of the financial capabilities of the power, and also as an indicator of how much the government of the country can be trusted from the point of view of a foreign investor.

Who calculates the gross national product?

GNP is calculated using almost the same methods as GDP, but the scale of action changes. So, if the gross domestic product is calculated for a certain territorial unit, then when calculating the gross national product, one has to take into account what is relevant to the people for whom the indicator is calculated.

The concept of GDP and GNP for most countries is not very different, even when calculated by private structures. For some, however, there are differences, and they are huge. One of these states is Tajikistan, which receives 60% of its gross domestic product from the work of economic migrants. Thus, the gross national product of this country has a multiple excess of GDP.

Why calculate GDP?

There are many ways to calculate gross domestic product. Initially, the state wants to know the potential of the economy in order to be able to plan the further consistent development of the state formation. Also, a comparison of indicators of gross domestic product allows you to see the progress and stability of its development. That is, data is provided, according to which potential investors will decide whether the country corresponds to favorable indicators for them, and whether it is worth investing in a project.

GDP is based on a number of other indicators that show the general level of life comfort, the possibility of a person realizing his talents, the level of social security and many other aspects of life. One such indicator is the human development index. But even if things are not going well in the country, and then the calculation of the gross domestic product has a certain meaning: it kind of shows the level of openness in the country, and although at the moments of the fall it restrains the investments of investors and causes panic among them, at the beginning of the growth it can provoke those who invests in assets that have reached the bottom value bar, and on the principle of a snowball to cause the economy to grow. Indicators of GNP and GDP are valuable precisely as indicators of the level of development of the country, indicators of the possible potential that can be worked with and which can be developed by converting into profit.

Why consider GNP?

The main purpose, which should only be mentioned, is to find potential reserves. The fact is that migrants who have left the country and conduct economic activities in the territory of another state can transfer money to their homeland. And ideally, once they save enough money, they can go home and start their own business, creating jobs and thus revitalizing economic life. But the problem is that although they try to take everyone into account, a rather small number return to their homeland, so it is impossible to consider the entire potential as usable. Typically, various models take into account indicators from 20 to 80 percent. Data is used to identify groups of people who are most likely to return.

Gross National Product is the total market value of all final goods and services produced by the citizens of a country with the help of national (i.e. owned) factors of production in one year.

Consider the basic concepts of this definition:

Cumulative. GNP is an aggregate indicator that characterizes the entire national output, total output.

Market. The value of GNP includes only official market transactions that have gone through the process of buying and selling and have been officially registered. Therefore, GNP does not include, firstly, labor for oneself (a person builds his own house, knits a sweater, repairs an apartment, a master fixes his own TV or car, a hairdresser does his hair); secondly, work on a gratuitous basis (friendly help to a neighbor when fixing a fence, to a friend when repairing an apartment); thirdly, the cost of goods and services produced by the "shadow" economy.

Although the sale of clandestine products is a market transaction, it is not officially registered or recorded by the tax authorities. The volume of production of this "sector" of the economy in developed countries is from a third to a half of the total output. The “shadow” economy refers to those types of industries and activities that are not officially registered and are not taken into account by national statistical and tax services. The "shadow" economy, therefore, includes not only illegal activities (drug business, underground dens and gambling houses), but also completely legal ones, the profits from which, however, are hidden from paying taxes. There are no direct calculation methods for estimating the share of the “shadow” economy, therefore, as a rule, indirect methods are used, such as additional electricity consumption in excess of the official requirement and additional money supply (amount of money) in circulation in excess of what is needed to service official transactions.

Price. GNP measures the national output in terms of money - in terms of value, because otherwise it is impossible to add apples to sheepskin coats, cars, computers, CD players, Pepsi-Cola, etc. Money serves as a universal equivalent of the value of all goods, a single meter that allows you to evaluate, measure the value of all various types of goods and services.

final. All products produced by the economy are divided into final and intermediate. End products- These are products that go to final consumption and are not intended for further industrial processing or resale. Intermediates goes into the further process of production or resale. As a rule, intermediate products include raw materials, materials, semi-finished products, etc. However, depending on the method of use, the same product can be both an intermediate product and a final product. So, for example, the meat bought by a housewife for borsch is the final product, as it went into final consumption, and the meat bought by the McDonald's restaurant is intermediate, as it will be processed and invested in a cheeseburger, which will be in this case. end product. All resales (sales of used items) are also not included in GNP.

GNP includes only the value of final products in order to avoid double counting. The fact is that, for example, the cost of a car includes the cost of iron, from which steel is made; steel from which rolled products are obtained; the rental from which the car is made. Therefore, the calculation of the cost of the final product is carried out value added . Let's look at this with an example. Suppose a farmer grows grain and sells it to a miller for $5, who grinds the grain into flour. He sold the flour to a baker for $8, who made dough out of flour and baked bread. The baker sold the pastry to the baker for $17, who, in turn, sold the bread to the customer for $25. The grain for the miller, the flour for the baker, the pastry for the baker are intermediate products, and the bread that the baker sold to the buyer is the final product.

Thus, value added is the net contribution of each producer (firm) to the national output. The amount of value added ($25) is equal to the cost of the final product, that is, the amount paid by the end consumer. Therefore, to avoid double counting, only value added equal to the value of the final product is included in GNP. Value added is the difference between total sales revenue and the cost of intermediate products (the value of raw materials and materials that each manufacturer (firm) buys from other firms). In our example: 55 - 30 = 25 (USD).

At the same time, all internal costs of the company (wage payments, depreciation, capital rent, etc.), as well as the company's profit, are included in value added.

goods and services. Anything that is not a good or service is not included in GNP. Those payments that are not made in exchange for goods and services are not included in the value of GNP. These payments include transfer payments and unproductive ( financial transactions.

Transfer payments are divided into private and public and are like a gift. Private transfers primarily include payments that parents make to their children, gifts that relatives make to each other, etc. Government transfers are payments made by the government to welfare households and firms in the form of subsidies. There is no payment for goods or services behind transfers.

Financial transactions include the purchase and sale of securities (stocks and bonds) on the stock market. Since there is no payment for either goods or services behind the security, these transactions do not affect the value of GNP. (But it should be borne in mind that the payment of income on the securities of firms is necessarily included in the value of GNP, since it is a payment for an economic resource, that is, factor income, a part of national income.)

Produced by the citizens of the country with the help of national factors of production. This statement is important in order to understand the difference between Gross National Product and Gross Domestic Product. GNP represents the total market value of all final goods and services produced with the help of national factors - it does not matter, on the territory of a given country or in other countries. Here the condition of nationality is important. GDP- is the total market value of all final goods and services produced on the territory of a given country - it does not matter, with the help of national or foreign factors of production. In this case, the territorial factor is important. In most developed countries, the difference between GNP and GDP does not exceed 1%. The difference between them is significant for countries that live off (or receive significant income from) tourism (Cyprus, Greece) or provide services, primarily banking, to citizens of other countries (Luxembourg, Switzerland).

Within one year. In accordance with this condition, only the value of final goods and services is included in GNP. produced in a given year and does not include the value of goods produced in previous years, decades, eras.

Gross national product. Gross national product)- the value of goods and services produced by residents of the country, both within the country and abroad. GNP is almost identical to gross domestic product (GDP), except that the latter does not include income accrued to residents of the country from investments abroad (minus income received in the domestic economy, but accrued to residents of other countries).In other words, GNP calculates the value of all products produced by domestic companies, regardless of the place of production.

The United States replaced GDP with GNP as the main indicator of economic volume only in the early 1990s.

How is gross national product calculated?

The official formula for calculating GNP is as follows:

Y = C + I + G + X + Z

Where:

C - consumption expenditure

I - investments

G - government spending

X – (value of export minus import)

Z - net income (inflow of net profit from abroad minus the outflow of funds to foreign countries)

Alternatively, GNP can also be calculated as follows:

GNP \u003d GDP + Net income inflow from abroad - Net income outflow to foreign countries

where

GDP = Consumption + Investment + Government Spending + Exports - Imports

GNP takes into account the production of tangible goods such as vehicles, agricultural products, equipment, etc., as well as the provision of services such as healthcare, business consulting, and education. GNP also includes taxes and depreciation. The cost of services used in the production of tangible goods is not taken into account separately, since it is already included in the cost of finished goods.

Read more about GDP in the article.

For comparison with previous years, the gross national product must be adjusted for inflation - real GNP. In addition, for comparisons of GNP between countries, GNP is calculated per capita. Because exchange rates can be volatile, statistical agencies use .

When calculating GNP, there are difficulties with respect to accounting for dual citizenship. If a producer has citizenship in two countries, both countries will count his productivity and this will result in double counting.

Comparison of GNP with GDP

Example of gross national product

A country's GNP can be higher or lower than its own GDP. It depends on the volume of domestic and foreign production in a particular country.

Japan's GNP exceeds the country's GDP by about $500 billion. The large-scale production of household appliances, electronics and automobiles by Japanese corporations at overseas enterprises is the reason for the higher GNP relative to GDP.

For example, a Japanese multinational corporation manufactures automobiles in the United States. The production of the foreign firm will be counted in the US GDP. However, dividends that a Japanese company distributes to shareholders in the US will be included in the US GNP under the heading “Net income inflow from abroad”

At the same time, in 2016, China's GDP was $300 billion more than its GNP, according to official data from the National Bureau of Statistics of the PRC. This is due to the huge number of foreign companies manufacturing inside China.

Despite, that both indicators try to measure the size of a country's economy, GDP is the most common method of measuring a country's economic success. However, GNP can also be useful. It is important for analysts and economists to have a deep understanding of both indicators for a more competent assessment of the risks and development prospects of a particular region.

The volume of products produced in a society is the main criterion for the effectiveness of the functioning of the economic system, an indicator of the slightest changes in the national economy. The well-being of all its citizens depends on how much goods and services are produced in a given country. Following the dynamics of the volume of products produced in society, they determine which phenomena in the life of the nation have benefited and which have not. Consequently, how the total volume of production changes also depends on what economic goals the society will set for itself, what the economic policy will be aimed at, what methods or levers of influence on the economic situation it will use.

12.1.1. Gross domestic product and gross national product: features of measurement and calculation

One of the main indicators of the SNA are indicators that reflect the volume of production in the economy. One of the main such indicators is the gross domestic product (GDP). Gross domestic product (GDP) - this is the market value of the entire set of final material goods and services produced in the territory of a given country for a certain period of time (most often for a year). In addition to the GDP indicator, the gross national product (GNP) indicator is widely used. Gross national product (GNP) – reflects the market value of the entire set of final material goods and services produced using only national factors of production, regardless of where they are located - on the territory of a given country or abroad. Thus, part of the GNP is produced abroad, on the other hand, part of the products that are created in the country, but when using resources belonging to other countries, are not taken into account in the GNP, but are included in its GDP. That is, the market value of products manufactured by a Russian enterprise abroad will be taken into account in the GNP of Russia and in the GDP of the country where this enterprise operates. For example, the cost of cars produced at an automobile plant owned by a foreign company located in the Russian Federation, including profits, is part of the Russian GDP. Conversely, profits received by one of the plants of a Russian firm, for example, in France, are excluded from the GDP of the Russian Federation. The relationship between GDP and GNP can be represented as the following scheme:

Rice. 12.1.1. Structural relationship between GNP and GDP

Quantitatively, the difference between GDP and GNP is determined by the amount of net income from foreign factors of production:

GDP=GNP+Net income from foreign factors of production

Net income from foreign factors of production, in turn, is the difference between income from foreign factors of production paid to other countries and income from domestic factors of production located abroad:

Net income from foreign factors of production can be both positive and negative. If it is positive value, this means that the resources owned by foreigners produced more output and income in this state than the resources of this state abroad. For most countries, the difference between GDP and GNP is negligible. For the United States and Russia, it is no more than 1%, for countries such as Luxembourg, Switzerland, and the Persian Gulf countries, it is approximately 10%.

In the SNA, the main place is occupied by the indicator of GDP, and it is to this that we will focus further. First, we describe the features of its calculation and measurement. Firstly, GDP is taken into account in monetary form, which is due to the impossibility of summing natural indicators, which measure the production of a wide variety of products (pieces, tons, meters, etc.). Secondly, GDP takes into account not only the production of material goods, but also services. Thirdly, the value of only final products is included in GDP, while the intermediate product is accounted for using the value added method. Under final product refers to a good or service intended for direct consumption by the public (households) or business. Intermediate - this is a product intended for further processing or resale. Intermediate goods are consumed in further production, while the final ones are not. GDP includes the value of final goods, but excludes the sale of intermediate products. The existence of an intermediate product is fraught with the danger of double, triple, etc. accounts, when the total result (the value of the products produced in the society) turns out to be overestimated several times. Let's explain with an example. GDP includes the cost of finished products (for example, a cotton shirt), but if GDP also includes the cost of fabric, threads, and other things that a shirt is used to create, then the value of GDP will be overestimated several times. The fact that only the final product is taken into account in GDP does not mean that the intermediate stages of production are not taken into account. Accounting is carried out by summing up the added value created at each next stage of the movement of manufactured products. Added value is the market price of the product produced, minus the cost of the materials used to create the product. Fourth, some types of transactions are not reflected in GDP:

transactions with securities - these transactions do not involve an increase in current production, because are nothing more than an exchange of paper assets. The funds involved in these operations do not directly participate in the current production of products;

state transfer payments (pensions, scholarships, social benefits) - a feature of state transfer payments is that their recipients do not make any contribution to GDP in response to these payments. Thus, their inclusion in GDP would lead to an overestimation of this indicator;

private transfer payments (inheritance, gifts, monthly subsidies received by students from home, etc.). These payments are not the result of production, but only the act of transferring funds from one private person to another;

operations in the used goods market, i.e. things that have gone through several stages of resale. Only two stages of implementation are taken into account in GDP - wholesale and retail trade. The rationale for excluding sales of used items from GDP seems to be quite clear: such sales either do not reflect current production or include double counting.

Fifth, some types of activities are not reflected in GDP: work in the household; shadow sector of the economy; work of scientists, inventors, teachers at home. Sixth, GDP takes into account goods and services produced by the government and not sold on the market (means of national defense and public order, free education). The cost of government services is usually assumed to be equal to the wages paid to employees of government agencies.

As you know, GDP is a certain fixed amount of goods and services produced in a society in a year. At the same time, this amount of goods is sold on the market and it can be calculated by summing up the costs of buyers for the purchase of this commodity mass. On the other hand, the amount of expenses, according to the model of economic circulation of goods, income and resources, must correspond to the amount of income (Fig. 12.1.2.). In this regard, there are two methods for calculating GDP - by the flow of goods and services (expenditures) and by the flow of income. GDP calculated from the income stream should equal GDP calculated from the expenditure stream. In fact, it's not just an equation, it's an identity. Purchase, i.e. spending money, and selling, that is, receiving money, are two sides of the same transaction. What is spent on a product is income for those who have invested their human and material resources in the production of this product and its sale on the market.

Income

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