What is the rate at which goods and services are produced based upon total output?

Gross domestic product (GDP) is the standard measure of the value added created through the production of goods and services in a country during a certain period. As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports). While GDP is the single most important indicator to capture economic activity, it falls short of providing a suitable measure of people's material well-being for which alternative indicators may be more appropriate. This indicator is based on nominal GDP (also called GDP at current prices or GDP in value) and is available in different measures: US dollars and US dollars per capita (current PPPs). All OECD countries compile their data according to the 2008 System of National Accounts (SNA). This indicator is less suited for comparisons over time, as developments are not only caused by real growth, but also by changes in prices and PPPs.

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Definition of Gross domestic product (GDP)

Gross domestic product (GDP) is the standard measure of the value added created through the production of goods and services in a country during a certain period. As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports). While GDP is the single most important indicator to capture economic activity, it falls short of providing a suitable measure of people's material well-being for which alternative indicators may be more appropriate. This indicator is based on nominal GDP (also called GDP at current prices or GDP in value) and is available in different measures: US dollars and US dollars per capita (current PPPs). All OECD countries compile their data according to the 2008 System of National Accounts (SNA). This indicator is less suited for comparisons over time, as developments are not only caused by real growth, but also by changes in prices and PPPs.

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Backward Linkages

Backward linkages show an industry’s dependence on the production by other upstream industries. A value greater/less than one shows that it is more/less dependent than average on the production of other upstream industries.

Basic Price

The amount receivable by the producer from the purchaser for a unit of a good or service produced as output minus any tax payable, and plus any subsidy receivable, on that unit as a consequence of its production or sale; it excludes any transport charges invoiced separately by the producer.

Compensation of Employees

Total remuneration payable by an enterprise to an employee in return for work done. It can be paid in cash or in kind. Examples include basic wage, bonuses, welfare benefits and employers' CPF contributions.

Consumption of Fixed Capital

The decline, during the course of the accounting period, in the current value of the stock of fixed assets owned and used by a producer as a result of physical deterioration, normal obsolescence or normal accidental damage.

Direct Requirement Coefficients

Direct Requirement Coefficients show the direct input requirements for every 1,000 units of an industry’s output.

Domestic Territory

In addition to the territory lying within the political frontiers of a country, domestic territory includes:

• ships and aircraft which are entirely or mainly operated by residents of the country;
• fishing vessels, oil and natural gas rigs, and floating platforms which are wholly or mainly operated by the residents of the country; and
• the embassies, consulates and military establishments of the country located abroad.

However, it excludes overseas territories and possessions.

Expenditure-based Gross Domestic Product (GDP)

The sum of private consumption expenditure, government consumption expenditure, gross capital formation and net exports of goods & services.

External Demand

The exports of goods and services.

Final Domestic Demand

The sum of private consumption expenditure of households including non-profit institutions serving households, government consumption expenditure and gross fixed capital formation.

Fixed Assets

Produced assets (e.g. buildings and infrastructure, transport equipment, machinery and equipment, and intellectual property products) that are used repeatedly or continuously in production processes for more than one year.

Forward Linkages

Forward linkages show an industry’s dependence on the purchases by other downstream industries. A value greater/less than one shows that it is more/less dependent than average on the purchases by other downstream industries.

Government Consumption Expenditure

Expenditures incurred by the general government on consumption goods and services provided to the general public.

Gross Capital Formation

Total value of gross fixed capital formation and changes in inventories

Gross Domestic Product (GDP)

Aggregate value of the goods and services produced in the economic territory of Singapore. The GDP estimates are compiled based on the output (or production), expenditure and income approaches. See Output-based GDP, Expenditure-based GDP and Income-based GDP.

Gross Domestic Product (GDP) Deflators

A broad measure of the change in the overall level of prices of the goods and services that make up GDP. The deflators are derived as the ratio of the nominal value of a component of GDP to its corresponding real value, with the reference year index set at 100.

Gross Fixed Capital Formation

Acquisitions, less disposals, of fixed assets during the accounting period plus improvements to land.

Gross National Income (GNI)

The aggregate value of the gross balances of primary incomes (incomes arising from the involvement in production processes or ownership of assets) receivable by resident units. See net national income.

Gross Operating Surplus

The surplus accruing to owners from production before deducting any explicit or implicit interest charges, rent or other property incomes payable on the financial assets, land and other natural resources require to carry on the production. Estimates for Gross Operating Surplus is mainly derived as the value of firms’ operating revenue less their operating expenditure, plus depreciation of their fixed assets.

Household

Consists of a group of two or more persons living together in the same house and sharing common food or other arrangements for essential living. It also includes a person living alone or with others but having his own food arrangements. Although persons may be living in the same house, they may not be members of the same household.

Income Components of Gross Domestic Product (GDP)

The sum of incomes generated from the domestic production of goods and services. These include compensation of employees, gross operating surplus and taxes less subsidies on production and on imports.

Input-Output Tables (IOTs)

The IOTs, provide an integrated and comprehensive framework for economic modelling and impact studies when supplemented with relevant information.

Inventories

The amount of materials and supplies, work-in-progress, finished goods and goods for resale.

Market Prices

The actual prices agreed upon by the parties in the transactions. In the absence of market transactions, valuation is made according to costs incurred or by reference to market prices for similar goods or services.

Net Exports of Goods and Services

Value of total exports of goods and services less total imports of goods and services.

Net Income from Abroad

Primary income received by residents of a country from abroad less primary income paid abroad to non-residents.

Net National Income

Gross national income less consumption of fixed capital. See gross national income.

Nominal Estimates

Estimates which are valued based on prices of the current reporting period. For example, nominal estimates for year 2018 are valued at 2018 prices.

Output-based Gross Domestic Product (GDP)

The sum of gross value added generated by economic activities in the domestic economy.

Ownership of Dwellings

Housing services provided by owner-occupiers and individuals who let out their residential properties.

Personal Disposable Income

Personal disposable income measures the income of the personal sector (e.g., compensation of employees, self-employment income, gross operating surplus on ownership of dwellings and non-profit institutions serving households), after accounting for net property income received (i.e., interests and dividends), net current transfers received and personal income tax paid.

Personal Saving

Personal saving refers to the amount of funds available after consumption and before the purchase of assets. Personal saving is not directly computed, but derived as the difference between personal disposable income and personal consumption expenditure on goods and services.

Primary Input Requirement Coefficients of Final Demand

Primary Input Requirement Coefficients of Final Demand show the primary input content of final demand. Primary inputs include imports, taxes on products and production, compensation of employees and gross operating surplus.

Private Consumption Expenditure

The final purchases of goods and services by resident households including non-profit institutions serving households.

Producer's Price

The amount receivable by the producer from the purchaser for a unit of a good or service produced as output minus any VAT, or similar deductible tax, invoiced to the purchaser. It excludes any transport charges invoiced separately by the producer.

Productivity

Measures how much output is produced relative to the inputs of labour, capital (plant and equipment) and technology. An increase in productivity implies that more output can be produced with the same or less inputs.

Labour Productivity measures output per unit of labour input. VA is generally used as the measure of output, while labour input may be measured by number of employed persons or hours worked per employee.

Multifactor productivity (MFP) relates output to a set of combined inputs, usually labour and capital. A change in MFP reflects the change in output that cannot be accounted for by the change in the combined inputs. MFP therefore measures the effects of changes such as technological progress, and changes in the organisation of production.

Personal Disposable Income

Personal disposable income measures the income of the personal sector (e.g., compensation of employees, self-employment income, gross operating surplus on ownership of dwellings and non-profit institutions serving households), after accounting for net property income received (i.e., interests and dividends), net current transfers received and personal income tax paid.

Personal Saving

Personal saving refers to the amount of funds available after consumption and before the purchase of assets. Personal saving is not directly computed, but derived as the difference between personal disposable income and personal consumption expenditure on goods and services.

Purchaser's Price

The amount paid by the purchaser, excluding any deductible VAT or similar deductible tax, in order to take delivery of a unit of a good or service at the time and place required by the purchaser. The purchaser’s price of a good includes any transport charges paid separately by the purchaser to take delivery at the required time and place.

Real Estimates

Real estimates exclude the effects of price changes from period to period. For example, real GDP refers to GDP adjusted for price changes.

Real Gross Domestic Product (GDP)

GDP adjusted for price changes to reflect the real value of output or expenditure over time. Real GDP is compiled in chained (2015) dollars.

Remuneration

The total remuneration of employees. Remuneration comprises three components, namely:

• Wages and salaries
• Employers' contribution to Central Provident Fund (CPF) or pension funds
• Other benefits

It does not include the remuneration of working proprietors and partners.

Residence

A concept used for the compilation of the national accounts and balance of payments estimates. Residents of a country include individuals residing in the country, corporations and enterprises located in the country as well as its embassies, military units, and official missions stationed abroad.

Statistical Discrepancy in Gross Domestic Product (GDP)

The measurement of the three approaches of GDP (production, income and expenditure) should conceptually be the same. In practice, however, they can be different as they are compiled largely from independent and diverse survey and administrative sources. In Singapore, output-based GDP (i.e. GDP by production) is the main approach used, and statistical discrepancies are recorded at the income and expenditure approaches.

Supply and Use Tables (SUTs)

The SUTs provide detailed information on production activities of an economy by recording transactions between producers and consumers in an economic system. 

Taxes less Subsidies on Production and Imports

Comprises taxes on products and other taxes less subsidies on production.

Taxes on products are taxes payable per unit of goods and services when they are produced, delivered, sold, transferred or disposed of by their producers. Examples include goods and services tax (GST), stamp duties and Certificate of Entitlement of motor vehicles.

Other taxes less subsidies on production consists of production taxes or subsidies. Production taxes are payable by enterprises during the process of production. Examples include foreign worker levy and property tax. Production subsidies are receivable by enterprises during the process of production. Examples include jobs credit pay-outs and government-paid maternity leave.

Total Demand

The sum of total domestic demand and external demand. Contribution to total demand of a segment is derived by taking total demand as the base.

Total Domestic Demand

The sum of private consumption expenditure of households including non-profit institutions serving households, government consumption expenditure and gross capital formation

Total Requirement Coefficients

Total Requirement Coefficients shows the total input requirements for every 1,000 units of an industry’s output. They are also commonly known as Leontief Inverse or Output Multipliers.

Value Added

Gross value added is derived by the output or income approach.

The output approach measures value added as output less intermediate consumption. Output refers to the value of goods and services produced in the economy while intermediate consumption is value of goods and services consumed as inputs by a process of production, e.g. materials, utilities, fuel, rental paid for premises and equipment, banking and financial charges and other operating costs.

The income approach derives value added as the sum of incomes generated from the domestic production of goods and services, which comprise gross operating surplus, remuneration and taxes (less subsidies) on production.

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