Glossary Finance Gross National Income

Gross National Income

Gross national income (GNI) is a measure of a country’s wealth. Many such measures exist, all varying slightly in how they are calculated. Gross Domestic Product is the most widely cited measure of national wealth. Gross National Income is an alternative measure which is very similar to Gross Domestic Product. Gross National Income is calculated in the same way as gross domestic product with the twist that income receive or given out to other countries is added in.

For example, if citizens of one country have invested heavily abroad in, say, shares, and those shares produced a regular dividend income which is repatriated each year to the country of the share owners, this income would show up in the figurers for gross national income.

Gross National Product

Gross National Product is a synonym of Gross National Income. Formerly, Gross National Income was the most popular measure of a country’s wealth. As the levels of global trade increased, however, and countries became more economically interdependent, and large multi-national corporations evolved with activities in many countries, eventually Gross Domestic Product came to be the preferred measure of wealth for most economic purposes.

For most countries, Gross Domestic Product and Gross National Income are almost identical. In a few rare instances, though, there may be a significant difference.