Definition: Gross domestic product

Category: Purchasing power parities

GDP can be estimated using three alternative approaches which, in theory, yield the same result, namely: the production approach – which sums all the value added generated by the country’s resident institutional sectors during the accounting period; the expenditure approach – which sums all the final expenditures incurred by the country’s resident institutional sectors during the accounting period; and the income approach – which sums all the factor incomes paid by the country’s resident institutional sectors engaged in domestic production during the accounting period.

Unless stated otherwise, the manual refers to GDP estimated by the expenditure approach and is defined as the total value of the final consumption expenditures of households, NPISHs (Non-profit institutions serving households) and general government plus gross capital formation plus the balance of exports and imports. http://ec.europa.eu/eurostat/product?code=KS-RA-12-023&mode=view