Gross Domestic Product
The Gross Domestic Product is the market value of all goods and services produced by labor and property within a country, regardless of nationality, in a given period of time. Normally, the GDP is calculated on an annual basis and includes all private and public consumption, investments, government expenditure and net exports. The Gross Domestic Product is one of the main indicators in measuring a country’s standard of living.
The real GDP, as shown in the above statistic, is composed to compensate for changes in the value of the national currency, defined as inflation or deflation, which allows for the comparison of a country’s annual GDP over a longer period of time (i.e. several years or decades). In order to achieve this, the market value of all elements of the GDP for all shown years is chained to a preselected dollar value. In case of the U.S. real GDP, the data are chained to the 2005 U.S. dollar value to correct for inflation.
The United States has by far the largest Gross Domestic Product of any single country on the globe. Only the European Union, with the combined GDP of its 27 member states, can top the U.S. GDP, and though China’s economy has grown rapidly to become the second-largest economy by GDP, China produces only half the market value of goods and services that the United States produces.