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Request for clarification, this is at the end of the sixth paragraph: Trade accounts for roughly 150% of national output, more than any other country at its
by fwhitaker 10y ago
Request for clarification, this is at the end of the sixth paragraph:
Trade accounts for roughly 150% of national output, more than any other country at its level of per-person GDP.
How can something account for more than 100% of output? Should it be 50%, or am I missing an economic term here?
- paulsutter 10y agoIf you import components worth X and export them in assemblies worth Y, the contribution to output is Y-X, whereas the contribution to trade is Y+X. So they must be doing a lot of assembly work. For example, I believe there are no semiconductor fabs.
- nabla9 10y agoGDP is not the same as sales/revenue of a business. GDP measures the value created in economy. GDP can be calculated in different ways but they add up to the same value. GDP is sum of all gross value added and final consumption minus value of intermediate consumption. Alternatively it's the sum of primary incomes distributed by resident producer units. If you manufacture a trinket that is sold for consumer for $100 but it costs $90 to manufacture, only $10 is added to GDP. https://stats.oecd.org/glossary/detail.asp?ID=1163 https://stats.oecd.org/glossary/detail.asp?ID=1163 https://stats.oecd.org/glossary/detail.asp?ID=2113 https://stats.oecd.org/glossary/detail.asp?ID=2113