Rough national product

In economy, the Rough National product ( GNP ) corresponds to the annual Production of Biens and commercial services created by a country, whether this production proceeds on the national ground or abroad.

Definition

The GNP is the full value of the final production of goods and services of the economic actors of a country given during a year given. With the difference of GDP, the GNP includes the net profits coming from abroad, i.e. the income on the investments Nets carried out abroad (this element being negative if the incomes of the investments from abroad on the national territory are higher than the incomes of the investments of the country abroad).

The " term; National" , in Rough National product , thus reflects the taking into account of the added-value produced by the residents of the country in question (principle of Nationalité) but it is not interior because part of this added-value is produced abroad (the GDP is him based on the principle of Territorialité). The GNP, just as GDP, includes VAT country, that whose legitimacy is disputed.

GNP = GDP + (returned of the factors of labor and capital coming from the outside - incomes of the factors of capital and labor poured outside)

GNP = GDP + Trade balance

The problem of the carpark

One of the question-trap posed by professors of economy to their students is the following one: If one transforms a free carpark into paying parking lot, is the effect to increase, decrease or leave unchanged the GNP of the country?

The first answer of which one thinks is that the GNP increases because of the appearance of a new valorization of exchanges. It is to forget that the budgets are not elastic and that what is paid on the carpark by its users it will not be by themselves elsewhere… but will be it perhaps by the recipients of these new incomes. After analysis, the answer - surprising - is that makes of it the problem arising in this way does not allow to know if the GNP will increase, decrease, or will possibly remain stationnaire.*

- In the chart of accounts, the developed exchanges are not any more the same ones. New exchanges appear (the paid price by the users of the carpark), but of other exchanges are some decreased and of other still increased.

- With the economic plan, if one makes the assumption of a similar behavior of the recipients of these new incomes, then the GNP will have increased with height of this new valorization. If their behavior is radically different, then the analysis becomes more complex: in certain cases, the studied GNP decreases: delocalization of the local GNP towards another GNP (remuneration of foreign assets), investments less productive, or expenditure in cycles of slower exchanges.

The indices of trend of prices, (on which for example the rates of Inflation rest) are supposed to take account of the increases in price, but it is not always possible. Thus, the lately paying carpark is the subject probably lately of a monitoring, an organization, a cleaning, a publicity, an indication, all things which contribute to its value and cannot be distinguished in an unquestionable way of a vulgar increase in price.

See too

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