income The following are some of the concepts used in measuring national income. . . .
. NNP at factor cost “The labour and capital of a country acting on its natural resources produce annually a certain net aggregate of commodities, material and immaterial including services of all kinds. This is the true net annual income or revenue of the country or national dividend”. -Alfred Marshall.
“The net output of the commodities and services flowing during the year from the country’s productive system into the hands of the ultimate consumers or into net addition to the country’s stock of capital goods”. - Simon Kuznets. GDP and its detractors. Simon Kuznets, (Creator of GDP) The welfare of a nation can scarcely be inferred from a measurement of national income as defined by the GDP...
goals for more growth should specify of what and for what. - - National Income income from abroad. GNP includes five types of final goods and services : ( ) value of final consumer goods and services produced in a year to satisfy the immediate wants of the people which is referred to as consumption (C); ( ) gross private domestic investment in capital goods consisting of fixed capital formation, residential construction and inventories of finished and unfinished goods which is called gross investment (I) ; ( ) goods and services produced or purchased by the government which is denoted by (G) ; and ( ) net exports of goods and services, i.e., the difference between value of exports and imports of goods and services, known as (X-M) ; Net factor incomes from abroad which refers to the difference between factor incomes (wage, interest, profits ) received from abroad by normal residents of India and factor incomes paid to the foreign residents for factor services rendered by them in the domestic territory in India (R-P); ( ) GNP at market prices means the gross value of final goods and services produced annually in a country plus net factor income from abroad (C + I + G + (X-M) + (R-P)). GNP at Market Prices =