Gdp and Gnp Usa

GDP and GNP

1. Definition of key term: Gross Domestic Product (GDP) measures the sales of goods and services which are made inside the country.

Gross National Product (GNP) measures what we as a nation make, not just inside the country but overseas as well.

1. Article:  Why is GNP so much higher than GDP?

               This article explained why the GNP of USA is more than its GDP. It says “Multinational corporations are increasingly producing more elsewhere than they are here”. (Bowyer, 2011) by this line we can see that the multinational companies are producing more outside of country than inside. Americans are looking a lot to produce outside USA and earn more of GNP. All this didn’t start recently. It started under the Bush presidency when the former president “threw out (his) free market principles in order to save the free market.” (Bowyer, 2011). “But one cannot make a nation less free in order to make it more free, any more than one can destroy a village in order to save it. Furthermore, you don’t support principles by throwing them out. “Principles” is the word we use to describe things we will never throw out” (Bowyer, 2011). Further we read that how US relies more on their production outside US then inside.

1. Discussion: It was a good experience reading all the articles. I always thought that a country should always produce more to get successful. But after reading this article I got to know how world’s most powerful economy itself has a greater GNP ratio that GDP. After reading about this topic I think for a country it doesn’t matter much which is higher to become a stronger economy, but I do feel that the ratio between GDP and GNP should not be a lot. With a greater GDP we do help our country within our boundaries, but with greater GNP we help our country without any boundary or limitations. It will be tough to have a perfect balance of both of them. I feel a country to excel more the difference should not be much in the ratio.

D.References:   

Bowyer, J. (2011, March 9). Why Is GNP So Much Higher Than GDP? Retrieved July 20, 2015, from http://www.forbes.com/sites/jerrybowyer/2011/03/09/why-is-gnp-so-much-higher-than-gdp/ Meaning of GDP and GNP. The summary and discussion was from this article

Worstall, T. (2011, June 28). GDP For a Country is Not the Same Thing as Turnover for a Business. Retrieved July 20, 2015, from http://www.forbes.com/sites/timworstall/2011/06/28/gdp-for-a-country-is-not-the-same-thing-as-turnover-for-a-business/

Keenan, B. (2015, June 20). GDP or GNP? It's an ecumenical matter - Independent.ie. Retrieved July 20, 2015, from http://www.independent.ie/opinion/columnists/brendan-keenan/gdp-or-gnp-its-an-ecumenical-matter-29297060.html

How countries calculate their GDP. (2014, March 26). Retrieved July 20, 2015, from http://www.economist.com/blogs/economist-explains/2014/03/economist-explains-26