What is national income?

Национальный доход – это новая стоимость total social product, created in physical terms in the sphere of material production during the year. At the same time, the number of goods created in the territory of the country is calculated, and after that, the costs that domestic enterprises have incurred during the reporting period are deducted from the estimate. In kind, national income includes the entire mass of the means of production and consumer goods produced during the year. This indicator is a kind of measure of economic growth in the country, and it is used by the government in calculating the budget for the next year, as well as for analytics and the development of new development strategies.

History

National income as a special term was firstintroduced by Karl Marx, because before him Western economic thought did not consider the criteria for social reproduction. Previously, the physiocrats were involved in this problem, including René, but they only considered agriculture when building the “Economic Table”, so the analysis of the number of products remained inaccurate.

D. Ricardo and A.Smith did not take into account the value of the means of production at all, therefore in their work only the amount of income received by the owners of enterprises was estimated, without taking into account the costs incurred. In the twentieth century, bourgeois economists included in this indicator not only profits from the production sector, but also the work of other industries - educational institutions, public administration and defense, and health care, so the indicator of economic development artificially increased by 20-30%.

In the socialist countries for the first time introducedthe concept of "national wealth", which includes not only the increase in productive forces, but also natural resources, as well as other material and spiritual values. This macroeconomic indicator in monetary terms represents the value of all assets valued at market prices, which are owned by the state and its residents.

In Russia

In the Russian Federation, in contrast to Western countries, the nationalincome still covers only the cost of material production; therefore, this macroeconomic indicator does not take into account income derived from other industries. So, its structure does not include scientific developments, the incomes received from exchange transactions, and profit of private medical institutions.

Approaches

Modern economists in calculating thisThe indicator uses several different approaches. The first of these is based on total income received from economic activity, and takes into account the wages of citizens, as well as the receipt of rent and dividends by residents. However, this amount is then distributed to make payments to households, business owners and fiscal authorities. The second approach is based on the calculation of production, while taking into account the added total value of all goods produced by the sectors of the national economy.

Structure

Net national income nowcalculated by a special formula. First, the primary amounts received by residents of the state during the reporting period are taken into account, and then the value of assets transferred abroad in cash or in kind is deducted from them. Economists can only deduct the producers' expenses for depreciation of equipment from the obtained indicator. The overall structure includes the gross and net output, as well as the wages of citizens, as the most important component of the national income.