Gross National Product (GNP) is the total value of all final goods and services produced within a nation in a given year, plus the net income from abroad. GNP is one of several measures of national income and output. It differs from Gross Domestic Product (GDP), which measures the value of all final goods and services produced within a nation’s borders regardless of ownership.
The GDP measures the total value of all goods and services produced in an economy. It includes everything from production by domestic producers to taxes (less subsidies) not included in the valuation of output, as well as net foreign primary income (employee compensation and property income). For example, the GNP does not include human capital and natural resources.
Gross National Product (GNP) measures a country’s economic output. GNP can be divided into domestic product, foreign investment, and net exports.
GNP is sometimes called “national income accounting” or “the national accounts.” It is a measure of a country’s economic performance. Countries are typically compared in terms of GDP.
Still, GNP is a more accurate measure of a country’s standard of living because it includes all income earned by its citizens, even if earned outside the country’s borders.
GNP is also a better measure of a country’s debt burden because it includes all income that must be used to service domestic and foreign debts.