Domestic product
The domestic product is a production indicator, ie it is used to specify the value of all goods and services produced within the country in a period, ie within the geographical boundaries of an economy. This included are goods that are produced by domestic companies whose owners are foreigners. However, not included are goods that domestic companies have produced abroad. The domestic product is an indicator of the economic performance of an economy. A distinction is made between the gross domestic product GDP ( including depreciation ) and net domestic product. To calculate the domestic product, there are three approaches, but ( mathematically ) each provide the same result, the
- Production approach
- Distribution statement and
- Distribution calculation
In the production approach, the production of a period ( production value) is net of input (you get the gross value added), net of FISIM (you get the adjusted gross value added ) plus net taxes (taxes less subsidies) on calculated; when using statement, the income from the general accounts production account are in their
- Consumptive or
- Investment- use (gross: including depreciation )
- Or in their use as export minus imports
Considered in the allocation statement, the allocation of GDP is on
- Wage income on the one hand (compensation of employees ) and
- Investment income on the other hand ( business and property income, gross: including depreciation ) is considered.
From the domestic to the national product
While in Germany a certain territory (domestic ) is considered with the production facilities located thereon, are the national income, the residents, who reside in this territory is considered. This can get primary income from abroad, which would then be added to the domestic product to obtain the national product. In addition, the domestic primary incomes have emerged that, to flow to people who live abroad. These are deducted from the domestic product to reach the national product. The national product thus obtained as the domestic product, less the primary income that flowed to the rest of the world, and adds the primary income that flowed from the rest of the world to residents. In the category " national " it depends on the place of residence, not citizenship.
Marking to market
The domestic product, gross and net, and the national income, gross and net, is valued at market prices, ie including the production and imports less subsidies.