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Definitions G

GDP

Gross Domestic Product (GDP, part of the National Income and Product Accounts) measures the value of goods and services produced in the US, regardless of who produces it (see also GNP).

From the NIPA Handbook (http://www.bea.gov/national/pdf/NIPAhandbookch1-4.pdf):

“In the NIPAs, a distinction is made between “domestic” measures and “national” measures. Domestic measures cover activities that take place within the geographic borders of the United States, while national measures cover activities that are attributable to U.S. residents. Thus, domestic measures are concerned with where an activity takes place, while national measures are concerned with to whom the activity is attributed. For example, GDP measures the value of goods and services produced by labor and property located in the United States, while gross national product (GNP) measures the value of goods and services produced by labor and property supplied by U.S. residents. Thus, both measures include the production that is attributable to labor and property supplied by U.S. residents who are located in the United States.”

GNP

Gross national product (GNP, part of the National Income and Product Accounts) measures the value of goods and services produced by Americans, wherever they are (see also GDP).

From the NIPA Handbook (http://www.bea.gov/national/pdf/NIPAhandbookch1-4.pdf):

“In the NIPAs, a distinction is made between “domestic” measures and “national” measures. Domestic measures cover activities that take place within the geographic borders of the United States, while national measures cover activities that are attributable to U.S. residents. Thus, domestic measures are concerned with where an activity takes place, while national measures are concerned with to whom the activity is attributed. For example, GDP measures the value of goods and services produced by labor and property located in the United States, while gross national product (GNP) measures the value of goods and services produced by labor and property supplied by U.S. residents. Thus, both measures include the production that is attributable to labor and property supplied by U.S. residents who are located in the United States.”

Government-Sponsored Enterprises

Government-Sponsored enterprises (GSEs), are corporations created by the U.S. Congress in order to reduce the cost of borrowing capital.

From Wikipedia:

“The government-sponsored enterprises (GSEs) are a group of financial services corporations created by the United States Congress. Their function is to enhance the flow of credit to targeted sectors of the economy and to make those segments of the capital market more efficient and transparent. The desired effect of the GSEs is to enhance the availability and reduce the cost of credit to the targeted borrowing sectors: agriculture, home finance and education.”

Gross and net government debt

In short, gross debt includes debt owed by the treasury to other branches of the government, while net debt does not. Equivalently, net debt takes into account government assets, while gross debt does not.

When the word “general” is used, as in “the general government sector” or “general government gross debt”, it means that state and local as well as federal government is included.

From my longer commentary on the concepts and their proper application:

The main fallacy in common thinking about government debt comes from including assets, but not liabilities, of government branches other than the Treasury. Gross government debt, which includes intragovernmental debt, provides the best simple measure of long-term solvency. Net debt, which includes only debt held by the public, is more important for understanding markets in the short term.

A US-specific definition from Wikipedia:

The United States public debt is a frequently reported measure of the obligations of the United States federal government and is presented by the United States Treasury in two components and one total:

  • Debt Held by the Public (net public debt), representing U.S. Treasury securities held by institutions or individuals outside the United States Government;
  • Intragovernmental Holdings, representing U.S. Treasury securities held in accounts which are administered by the United States Government, such as the OASI Trust fund administered by the Social Security Administration; and
  • Total Public Debt Outstanding (gross public debt), which is the sum of the above components.

And from the Canadian Encyclopedia:

Governments finance their expenditures by taxing and borrowing. They sometimes raise money from the public or from institutions by selling securities, eg, bonds. The accumulated total of all such government liability is called the “public debt.”

… “net debt” is the difference between gross debt (unmatured government bonds, bills, notes and other liabilities) and certain recorded financial assets of the federal government, eg, cash, investments and loans. Basically, changes in net debt equal budgetary deficits or surpluses, and the federal government's total net debt at any time therefore equals its accumulated overall deficit since Confederation.

From the OECD iLibrary:

Subject to data availability, debt refers to general government consolidated gross financial liabilities as a percentage of GDP, based on the 1993 System of National Accounts (SNA) or on the 1995 European System of Accounts (ESA). The general government sector consists of central, state and local government units together with social security funds controlled by those units. In principle, debts within and between different levels of government are consolidated. In other terms, a loan from one level of government to another represents both an asset for the first level and a liability for the second, and they cancel out for the general government sector as a whole (i.e. are “consolidated”). The SNA/ESA definition differs from the definition of debt applied under the Maastricht Treaty. First, gross debt according to the Maastricht definition excludes trade credits and advances, as well as shares and insurance technical reserves. Second, government debt according to the Maastricht definition is valued at face (i.e. at issue prices) rather than market value as required by the SNA93. The United States and Canada also value government bonds at their face value.