# ESD and GNP are the same

## Gross National Income

The gross national income (GNI, old term: gross national product) describes the sum of the income that the inhabitants of a country have earned within a year. The calculation is independent of whether the income was earned in Germany or abroad. The GNI thus corresponds to the value of all goods and services that are generated in one year by domestic companies, households and the state.

National concept and domestic concept

The ESD records the economic activities of all those involved with permanent residence in Germany (national concept). The idea behind this is that with production, income such as wages, salaries, interest, rents, leases and profits are generated at the same time and in the same amount. Another measurement concept is the gross domestic product (GDP). To calculate this, the result of production is measured within the geographical boundaries of a country or an economic area (domestic concept). It does not matter whether it was generated by residents or foreigners.
The statisticians calculate the GNI by subtracting the primary income to the rest of the world from the GDP and adding the primary income from the rest of the world. Primary income is the term used to describe the employee wages, corporate and property income accruing to the domestic sectors, as well as the production and import taxes received from the state minus subsidies.
Domestic product and national income are calculated and presented both gross and net, i.e. after deduction of depreciation.

Nominal and real GNI

The GDP - and thus also the GNI - are calculated by statisticians once on the basis of current prices ("at current prices"). But this nominal calculation only provides an imprecise basis for calculating economic growth, because GDP would grow even if only prices rose. For the real calculation, i.e. adjusted for inflation, GDP and GNI are therefore also shown "at constant prices". To do this, just like when calculating inflation, a certain base year is set equal to 100. In the following years, the values ​​then refer to this base year.

additional Information
Federal Statistical Office: Current calculation of gross national income