Questions tagged [gdp]

Gross Domestic Product (GDP) is a flow measure of the value of finished goods and services produced within a country's borders in a specific time period. GDP is typically calculated on an annual basis.

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1answer
408 views

Why are there base years for GDP in current prices (or Nominal GDP)?

I am looking at GDP in current prices for Indian states and there are multiple base years. This is confusing because GDP in current prices is supposed to be reported in the value of the currency for ...
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67 views

Which measures are there to evaluate a country economical development? [duplicate]

I'm familiar with the measures of Gross domestic product (GDP PPP) total, per capita and GDP nominal total and per capita. But I'm not sure if these measures evaluate the economical development of a ...
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106 views

Regression of Real GDP on Intellectual Property Products Problem

I have a question regarding regressing the log growth of Real GDP on the log growth of Intellectual Property production which contributes to GDP (through using the expenditure method of calculating ...
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1answer
88 views

Real GDP Computation and Justification

How does one really compute inflation? I just now quickly looked up how the real GDP was computed. It is using the base year price to multiply the number of products traded. Is that meaningful? Is a ...
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1answer
178 views

China GDP Data - Base year

I had been searching for the GDP data of China and finally found it here. The dataset gives the log real GDP data from 1992 (annual, quarterly and monthly). It doesn't specify the base year of the ...
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1answer
56 views

Profit for business owners vs. incomes of the self employed

I am learning the way to calculate GDP with incomes. So there is labor income and capital income. One element of the labor income is incomes of the self-employed. And for Capital income, an element ...
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2answers
1k views

How does borrowed money affect GDP?

Suppose that a household borrows from the bank with %2 interest rate and uses the money for paying rent; Is this a Consumption? May households borrow money from the bank for consumption, not ...
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2answers
388 views

Is population growth irrelevant with respect to per capita GDP growth

In Solow's growth model the growth rate of the output or GDP of a country is denoted by $g$. In the model this can be decomposed to $$ g = g_l + g_k, $$ where $g_l$ is the growth rate of the effective ...
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253 views

Domestic Demand, Private Consumption, Public Consumption, Gross Fixed Investment Relationship

I'm reading the IMF's January 2016 Report on Sweden's Economic Indicators, and the top section has the following: Domestic Demand (2012) Percent Change: -0.6 Indented below are: Private Consumption ...
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164 views

In what sense is economic growth cumulative?

In my economics syllabus, one of the student competences is to "Show the cumulative nature of growth and measure average and annual rates of growth". What I don't understand is how a country's GDP ...
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90 views

If I employ someone to destroy a building, what is the net GDP impact?

Can this one-off cases be extended? For instance, if I employ someone to destroy 50 buildings and rebuild them, does that contribute an increase in GDP?
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836 views

How can Aggregate Supply = National Income

I have researched two seemingly contradictory definitions for Aggregate Supply, and I don't know how to reconcile them: The total level of income in an economy over a given period of time. or The ...
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1answer
453 views

How Does GDP Differ From NNW as an economic measure?

When people talk about the size of an economy, they often refer to the GDP or changes to it, but seldom refer to the Net National Wealth. Obviously there are some superficial differences: GDP is ...
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Value of Used Goods in GDP

Why do sale of used goods do not add to income of a country in a particular year? If you think of income as the inflow in your bank account. All outflows are just expenditures. So I think of income as ...
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What types services count as intermediary consumption when calculating GDP?

What types of services count as intermediary consumption when calculating GDP? I'm not quite sure where the line is drawn. The examples below try to illustrate my confusion. Say a supermarket provider ...
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0answers
15 views

GFCF/GPDI in Real GDP Calculations

I'm trying to understand how GPDI / GFCF are used in the real GDP calculations (when compared to net investment). In both the US / Denmark, the real GDP numbers seem to directly GPDI / GFCF without ...
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40 views

What is the best measure for the world's economic cycle?

I'm trying to make a graph that shows how the return of major assets (S&P 500 index, % of 3Y T-notes, oil, gold, etc) move along with the world's expansion& recession cycle. I looked into ...
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4answers
43 views

How does capital investment (factory, plant, etc.) benefit the region they are located in?

Generally, capital investment is always good for the economy, but I am not sure about the underlying mechanism. For example, if a car factory is built in a certain state, does it improve the economy ...
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2answers
45 views

Unit root testing in Eviews

I've plotted my data log(GDP) which displays an albeit small upward trend. However, after performing an ADF unit root test log(GDP) it suggests that I can reject H0 [that there is a unit root] at the ...
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1answer
62 views

What does the GNI/GDP ratio of a country signify about?

What does it mean, if the GNI of a country is lower than the GDP
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Historically has the “decoupling” of world trade from GDP not lead to (or deepened) a recession?

The ECB speaks (somewhat euphemistically, in my opinion) of a "decoupling" of world trade from "activity" (i.e. GDP) in Q1 2019: Historically, has it been the case that such a "decoupling" can last, ...
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2answers
55 views

What does it mean when we talk about “same basket” exactly for both GDP and CPI?

When we say about "the basket used for calculating the CPI is the same as the composition of GDP" What does it mean the "same basket"? Does it just mean the goods and service are the same but the ...
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21 views

Performing good forecasts for the GDP

What forecasting models would you recommend to forecast the GDP? Through a quick research I have found that VEC, VAR, SVAR models are the most common. Are they though good forecasters? Or are they ...
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54 views

Does consumption decrease directly lead to a shift in Aggregate Demand curve to the left?

Studying macroeconomics I began to wonder about the validity of a certain statement that I couldn't find a clear answer to: "When Consumption decreases, Aggregate Demand curve will shift to the left....
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Unsure how to go about computing GDP for the following problem

I came across this question where the GDP for the years 1995-1997 is given. Then I was asked to compute the growth rate every year which I'm aware of.The next question was to compute the average which ...
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48 views

'Taxes less subsidies' included in income approach of GDP

Why is 'taxes less subsidies' a part of the calculation of GDP (income approach)? Is it because in the expenditure method of GDP, consumption expenditure will exceed those of the total "wages and ...
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153 views

How large is the Underground Economy in the U.S

How large is the Underground Economy in the US, and is it growing or getting smaller as a percent of GDP?
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Economic history/geography of the UK (1960-today)

I am not an economist and I am looking for reference knowledge about how the economy of the UK (mainly focussing on England/Scotland/Wales) developed over the past 5 decades. The kind of information I ...
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62 views

How Switzerland has significantly high cost of living as compared to its neighboring countries?

Despite being a small country (area-wise), how Switzerland can sustain a high cost of living? I get the logic that the pay of employees would be proportionally higher, so they can sustain a high ...
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26 views

Relation between growth rate of GDP and real interest rate for sustainable debt-to-GDP ratio

Why is the relation between the growth rate of GDP and the real interest rate important for sustaining the government the debt-to-GDP ratio ?
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19 views

Why Does National Data Usually Cite Average Income Rather than Median Income?

When I try to look into standard of living in a given country, I try to find median income figures. I can almost never find them. Instead, all of the data I can find is about average income, GDP per ...
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2k views

Will an increase in interest rate cause short run aggregate supply to shift?

Most business borrow for financing their purchases of raw material and capital etc. Shouldn't a interest rate rise cause cost of production to increase, therefore shifting SRAS to left? Thanks in ...
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29 views

How GDP by expenditure and GDP by income method are same in this case?

Suppose I earn factor wage ₹1000 in the year 2018 and I pay a tax of ₹100 to the government. So GDP by income method is ₹1000 as we ignore transfer payments. Now if I spent all my 900 on domestic ...
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66 views

Is there any ranking of countries based on per-capita expenditure in R&D?

All the rankings available on the internet are "R&D expenditure by % of GDP". Is there any ranking of countries based on per-capita expenditure in R&D?
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55 views

Historical GDP of world economies back to 1945: What are the most complete and reliable data sets?

I need the historical GDP of all modern countries (or at least the vast majority) from 1945 to now. It seems the world bank data only starts in 1960 or later. I found Angus Maddison's data, but I don'...
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43 views

Comparing GDP contractions between Russia and US

I was reading Rogoff's piece on the Russia's economic outlook, and in a paragraph, he states The shock to the real economy has been severe, with Russia suffering a decline in output in 2015 and ...
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35 views

How much does one percent of unemployment 'cost'? (Unemployment elasticity)

There is always debate that increasing minimum salary will pour in more money into the budget as those who get minimum salary will spend them immediately. The counter argument is that increasing ...
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506 views

How does an import driven economy function?

Can a country's economy,where everything is imported from other countries, solely depend on the income from its retail industry?
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37 views

Recommendations for ways to address gaps in GDP data?

I am a biologist that is using GDP data as part of my next research project and I am finding large gaps in the data, both in terms of years and countries. I am wondering what the best practice is for ...
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1answer
5k views

The period of the business cycle in which the real GDP is increasing is called the?

The period of the business cycle in which the real GDP is increasing is called the? And no, this is not an homework question. I'm a college student and we starting our exams soon. I'm just going ...
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Influence of a TTIP on the GDP of a european country

So my question is simple but what I would like to know is if my method of calculating something like that plausible or not. So it goes like this : the formula we took at lecture for calculating is ...
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435 views

Interpretation of the Impulse Response Function

I have an IRF that shows the GDP shock to GDP. Let's say I have a 5-year forecast of GDP. If there is an immediate 1% decrease in GDP today, can I adjust the original 5-year forecast by using the IRF?...
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3answers
66 views

Debt bearing capacity

In times of low yields and the prospect of rising yields, I asked myself if the european countries can ceteris-paribus cope with rising yields. Is there a way to calculate the effect of rising yields (...
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Is there a change over the business cycle in how much of economic activity is market-based?

Out of the total production in an economy, a big part is market-based, as when you make something and sell it. But a big part is not, as when you make something and don't sell it, but exchange it or ...
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Isn't recession is when there's an actual decrease and not just a less rapid growth?

I heard that for 2020, the global economic forecast is recession. The growth will be less than 2.5%. But isn't recession is when there's a decrease in GDP (for two consecutive quarters, as I recall), ...
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113 views

German economic growth in the 20th century

Regarding this great animation: Animation: The World’s 10 Largest Economies by GDP (1960-Today) I have the following questions: Why did Germany's GDP shrink so much from 1995 to 2000, while the GDP ...
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93 views

Why isn't PPP given due importance?

A unit of money in Country X may buy far more goods in Country Y than in the former. But Country X prides in calling itself a larger economy and a more prosperous entity. As money is just a social ...
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1answer
38 views

What is it called when there is no personal increase of wealth but GDP increases because of mutual sales?

In a hypothetical situation, every person produces some product but instead of consuming it sells it to another person. This situation would increase the GDP whereas self-consumption doesn't. Say, ...
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Is the concept of limited liability in corporate law beneficial to economy

The concept of limited liability in corporate law is widespread all over the world. Limited liability means, that owners of a company can only loose their capital invested into the company - the ...
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932 views

What is the wealth of a company?

I would like to better understand what is the wealth of a company and what is made of. Is the wealth of a company similar to GDP of country, like a "gross company product" ? As example: can we say ...

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