Gross National Product (GNP)
Plain definition
Gross National Product is the total market value of all final goods and services produced by a country's residents in a given period, wherever in the world they are produced. Unlike GDP, which counts output by location, GNP counts output by nationality of the producer.
In economics
GNP matters because income follows ownership, not location. A country's citizens may earn significant income abroad through overseas investments, factories, and remittances, while foreigners may earn income inside the country. GNP equals GDP plus net income receipts from abroad. For countries with large diasporas or multinational firms, GNP can differ substantially from GDP.
Example
Ireland hosts many foreign-owned tech and pharma firms, so GDP counts their output as Irish production. Much of that profit is repatriated abroad, making Ireland's GNP noticeably smaller than its GDP. Conversely, a country whose citizens earn large sums working abroad will have GNP above its GDP.
GDP and GNP are frequently swapped, but they differ: GDP measures what is produced inside the borders (domestic), while GNP measures what the country's residents produce anywhere (national). Most countries report GDP as the headline figure today; GNP's closest modern successor is GNI (gross national income), which is computed similarly.