Gross Domestic Product etc - 21

Expenditure approach GDP
(continued from previous post)

2.42 Gross capital formation is measured by the total value of the gross
fixed capital formation, changes in inventories and acquisitions less disposals
of valuables. Gross fixed capital formation is measured by the total value of a
producer's acquisitions, less disposals, of fixed assets during the accounting
period plus certain additions to the value of non-produced assets realised by
the productive activity of institutional units. Fixed assets are tangible or
intangible assets produced as outputs from processes of production that are
themselves used repeatedly or continuously in other processes of production
for more than one year. There is substantial diversity in the different types of
gross fixed capital formation that may take place. The following main types
may be distinguished:
(a) Acquisitions, less disposals, of new or existing tangible fixed assets,
subdivided by type of asset into:
(i) Dwellings;
(ii) Other buildings (c) Major improvements to tangible non-produced assets, including
land;
(d) Costs associated with the transfers of ownership of non-produced
assets.
2.43 Given the general explanations of the previous section, the main
identities connecting the aggregates of the SNA 1993 are summarized in this
section: GDP at market prices is defined from the expenditure side as:
Household final consumption expenditure + NPI final consumption
expenditure + Government final consumption expenditure + Gross
fixed capital formation + Acquisition less disposals of valuables +
Changes in inventories + Exports (f.o.b.) – Imports (f.o.b.)and structures;
(iii) Machinery and equipment;
(iv) Cultivated assets - trees and livestock that are used
repeatedly or continuously to produce products such as fruit,
rubber, milk, etc.
(b) Acquisitions, less disposals, of new and existing intangible fixed
assets, sub-divided by type of asset into:
(i) Mineral exploration;
(ii) Computer software;
(iii) Entertainment, literary or artistic originals;
(iv) Other intangible fixed assets;
[Reproduced from CSO Publication][To be concluded]