After coming up with the very satisfying description "Gross Domestic Spending" it took me a few days to Google the term. I didn't want to discover that someone else was already using it to mean something else.
Gross Domestic Product is all the stuff produced here in a year, or all the final spending we do in a year. (That's what you'd think, anyway.) Gross Domestic Spending is all the spending it took to produce all that stuff, that year. It's a really good term. It has symmetry -- the "G" and the "D", I mean. And the product is the product, and the spending is the spending. The meaning is just very clear. That's what I think, anyway.
And if you repeat the phrase a few times, it starts to seem natural. "Gross Domestic Spending" seems a more natural term to me now than "Gross Domestic Product". I like that.
But Google it I did. I think I'm safe. The term doesn't seem widely used for anything else. But I did find a few results.
Actually, I Googled "gross domestic spending" in quotes like that. I should get exact matches. The first result was to Gross Domestic Product (GDP) - Bureau of Economic Analysis but the blurb says "A description for this result is not available because of this site's robots.txt..." That's funny, I think. What is BEA hiding and why are they hiding it?????? Anyway I went to the page and found nothing matching "gross domestic s".
I tried the third result next: BDLive, from Johannesburg apparently. The article talks of "gross domestic expenditure" as if it was GDP, forecasting growth rates and describing the consumer component and like that. Reminded me of something I read at Wikipedia the other day. I didn't read much of either, actually. But we'll come back to that.
The second result is Gross national expenditure (current US$) | Data | Table from the World Bank. Turned out to be worth the click. Under the heading Gross national expenditure (current US$) they offer a definition of sorts:
Gross national expenditure (formerly domestic absorption) is the sum of household final consumption expenditure (formerly private consumption), general government final consumption expenditure (formerly general government consumption), and gross capital formation (formerly gross domestic investment).
Hard to read with all those parenthetical phrases, but okay. It's the sum of final consumer spending and final government spending and investment. Sounds like GDP. Maybe they leave off "net exports". But...
Oh, maybe that's the difference, net exports.
The number they list for the U.S. for 2012 is $16,791.8 billion. The number FRED gives for GDP for the U.S. for 2012 is 16,244.6. FRED's number is 96.74% of the World Bank number. The difference is 3.26%. That sounds about right for loss due to net exports...
I went to FRED to check, and got net exports as 3.37% of GDP for 2012. Pretty close to 3.26%. Close enough. You can do more years and check my work, if you want. If you do, let me know what you find.
Okay, so I'm saying "Gross National Expenditure" is GDP before they figure net exports.
That's not the same as Gross Domestic Spending.
Next, a look at what I found at Wikipedia the other day.
3 comments:
Gross Domestic Product is all the stuff produced here in a year, or all the final spending we do in a year. (That's what you'd think, anyway.)
For more on that, see tomorrow's post.
I very vaguely remember something similar to what you call "Gross Domestic Spending" in Soviet national income accounting. They counted both final and intermediate goods. Or was it Cuba?
What are you trying to say, Nick? :)
Yes, I suppose I am treading very near to the sacred rights of property.
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