0
$\begingroup$
  1. How is Public Administration generally considered when looking at GDP Income Approach by industry?
  2. Is remuneration of employees the main factor considered, since there is no Operating Surplus?

I am trying to understand the key principles of such calculations, rather than detailed mathematics. Thanks.

$\endgroup$
0
$\begingroup$

Income approach will sum all gross profits, rents, interest, wages and indirect taxes minus subsidies across the economy. If you want to separate GDP by industry then for public administration you just sum all of the above for its category.

Public administration includes among other things:

Services like transportation, maintaining law and order, road construction, police, jails, tax exemptions, medicare, social security,

Some of the above won't generate profit but some can (for example public transportation). The same holds for interest, rents, wages and so on. For GDP in public administration you just sum gross incomes in this category.

$\endgroup$

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.