Supplementary resources by topic. GDP is one of 51 key economics concepts identified by the Council for Economic Education (CEE) for high school classes.

GDP

On this page:

Definitions and Basics
In the News and Examples
A Little History: Primary Sources and References
Advanced Resources
Related Topics

Definitions and Basics

Gross Domestic Product (GDP), from the Concise Encyclopedia of Economics

Gross domestic product, the official measure of total output of goods and services in the U.S. economy, represents the capstone and grand summary of the world’s best system of economic statistics….

For the United States, GDP replaces gross national product (GNP) as the main measure of production. GDP measures the output of all labor and capital within the U.S. geographical boundary regardless of the residence of that labor or owner of capital. GNP measures the output supplied by residents of the United States regardless of where they live and work or where they own capital. Conceptually, the GDP measure emphasizes production in the United States, while GNP emphasizes U.S. income resulting from production.

GDP is one measure, but not a perfect measure, of the well-being of the citizens of a country. For example, homemaker income is not traded in markets, and so is not included in GDP. (Because stay-at-home moms are not paid salaries, there are no government records for how much output they produce for their families.) Economic Indicators, from the Social Studies Help Center.

The Gross National Product (GNP) is a nation’s total output of goods and services produced BY a country in one year. In obtaining the value of the GNP, only the final value of a product is counted (e.g. homes but not the construction materials they were built with). The three major components of GNP are consumer purchases, government spending, private investment and exports. The formula is thus:

C + G + I + X = GNP
… The fourth factor is the exclusion of non market activities. Non market activities are those activities that do not take place in the market, and most of them are not accounted for because of measurement problems. Such activities include services people provide for themselves like home maintenance, and the service homemakers provide.

U.S. Gross Domestic Product (GDP), from the U.S. National Economic Accounts. Bureau of Economic Analysis (BEA, a division of the U.S. Department of Commerce).

The latest GDP data, definitions, interactive tables for finding data from previous years and quarters, and more.

In the News and Examples

Gapminder World, at Google.com

Interactive graphic showing correlation between GNP and life expectancy, population, phone use, and much more, by country over a period of years. Select your choice of variables, display styles, and watch the changes over time!

A Little History: Primary Sources and References

First measurements of GNP: Simon Kuznets, biography from the Concise Encyclopedia of Economics

Simon Kuznets is best known for his studies of national income and its components. Prior to World War I, measures of GNP were rough guesses at best. No government agency collected data to compute GNP, and no private economic researcher did so systematically, either. Kuznets changed all that. With work that began in the thirties and stretched over decades, Kuznets computed national income back to 1869. He broke it down by industry, by final product, and by use. He also measured the distribution of income between rich and poor.

Advanced Resources

Related Topics

Real vs. Nominal

Inflation

Economic Growth

Business Cycles

Saving and Investing

Supply