Glossary
A comprehensive guide to economic terms, indicators, and acronyms used throughout Visonomics807.Economic Indicators
Growth & Output
GDP (Gross Domestic Product)
GDP (Gross Domestic Product)
The total monetary value of all goods and services produced within a country’s borders in a specific time period. GDP is the primary measure of a country’s economic size and health.Common variants:
- Nominal GDP: Measured in current prices
- Real GDP: Adjusted for inflation (constant prices)
- GDP per capita: GDP divided by population
- GDP growth rate: Percentage change from previous period
GNI (Gross National Income)
GNI (Gross National Income)
The total income earned by a country’s residents and businesses, including income earned abroad. Unlike GDP, GNI includes income from foreign investments but excludes income earned by foreigners within the country.
GNP (Gross National Product)
GNP (Gross National Product)
Similar to GNI, this measures the total value of goods and services produced by a country’s residents, regardless of location. GNP = GDP + net income from abroad.
PPP (Purchasing Power Parity)
PPP (Purchasing Power Parity)
An economic theory that adjusts exchange rates to equalize the purchasing power of different currencies. PPP-adjusted figures help compare living standards across countries by accounting for price differences.
Trade & Investment
FDI (Foreign Direct Investment)
FDI (Foreign Direct Investment)
Investment made by a company or individual in one country into business interests in another country. FDI typically involves establishing business operations or acquiring assets, with a controlling ownership stake (usually 10%+ of voting stock).Types:
- Inward FDI: Foreign investment coming into a country
- Outward FDI: Domestic investment going to foreign countries
Trade Balance
Trade Balance
The difference between a country’s exports and imports. A positive balance (exports > imports) is a trade surplus; a negative balance is a trade deficit.
Current Account
Current Account
A component of the balance of payments that includes trade in goods and services, income from investments, and transfer payments. It’s a broader measure than trade balance.
Terms of Trade
Terms of Trade
The ratio of export prices to import prices. Improving terms of trade means a country can buy more imports for the same amount of exports.
Inflation & Prices
Inflation
Inflation
The rate at which the general level of prices for goods and services rises over time, eroding purchasing power. Measured as an annual percentage increase.Common measures:
- CPI (Consumer Price Index): Tracks prices of a basket of consumer goods
- Core inflation: Excludes volatile food and energy prices
- GDP deflator: Measures price changes in all goods and services
CPI (Consumer Price Index)
CPI (Consumer Price Index)
A measure that examines the weighted average of prices of a basket of consumer goods and services. It’s the most common measure of inflation experienced by households.
Deflation
Deflation
A decrease in the general price level of goods and services. The opposite of inflation, deflation can lead to reduced consumer spending as people wait for lower prices.
Hyperinflation
Hyperinflation
Extremely rapid inflation, typically defined as price increases exceeding 50% per month. It severely disrupts economic activity and erodes savings.
Labor & Employment
Unemployment Rate
Unemployment Rate
The percentage of the labor force that is jobless and actively seeking employment. It’s a key indicator of economic health.Types:
- Cyclical: Due to economic downturns
- Structural: Mismatch between skills and jobs
- Frictional: Short-term, during job transitions
Labor Force Participation Rate
Labor Force Participation Rate
The percentage of the working-age population that is either employed or actively looking for work. It excludes discouraged workers who have stopped searching.
Productivity
Productivity
The efficiency of production, typically measured as output per hour worked or output per worker. Higher productivity usually leads to higher wages and living standards.
Government & Fiscal
Fiscal Deficit/Surplus
Fiscal Deficit/Surplus
The difference between government revenues and expenditures. A deficit occurs when spending exceeds revenue; a surplus when revenue exceeds spending.
Public Debt
Public Debt
The total amount of money owed by a government to creditors. Often expressed as a percentage of GDP to assess sustainability.Also called: Government debt, national debt, sovereign debt
Tax Revenue
Tax Revenue
The income collected by governments through taxation. Includes income tax, corporate tax, sales tax, customs duties, and other levies.
Development & Welfare
HDI (Human Development Index)
HDI (Human Development Index)
A composite index measuring average achievement in three basic dimensions of human development:
- Long and healthy life (life expectancy)
- Knowledge (education)
- Decent standard of living (GNI per capita)
Gini Coefficient
Gini Coefficient
A measure of income or wealth inequality within a population. Ranges from 0 (perfect equality) to 1 (perfect inequality). Higher values indicate greater inequality.
Poverty Rate
Poverty Rate
The percentage of the population living below a defined poverty line. Common thresholds include:
- Extreme poverty: $2.15/day (World Bank)
- Moderate poverty: $3.65/day
- National poverty lines: Vary by country
Life Expectancy
Life Expectancy
The average number of years a person can expect to live, based on current mortality rates. A key indicator of health system quality and overall development.
Country Groups & Blocs
Economic Blocs
| Acronym | Full Name | Members |
|---|---|---|
| G7 | Group of Seven | Canada, France, Germany, Italy, Japan, UK, USA |
| G20 | Group of Twenty | G7 + Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, EU |
| BRICS | Brazil, Russia, India, China, South Africa | Emerging market alliance |
| EU | European Union | 27 European member states |
| OECD | Organisation for Economic Co-operation and Development | 38 developed countries |
| ASEAN | Association of Southeast Asian Nations | 10 Southeast Asian countries |
| OPEC | Organization of the Petroleum Exporting Countries | 13 oil-producing nations |
Income Classifications
The World Bank classifies countries by income level based on GNI per capita:| Classification | GNI per Capita (2024) |
|---|---|
| Low Income | < $1,145 |
| Lower Middle Income | 4,515 |
| Upper Middle Income | 14,005 |
| High Income | > $14,005 |
Units & Abbreviations
Common Units
| Unit | Meaning |
|---|---|
| % | Percentage |
| $ (USD) | US Dollars |
| constant prices | Inflation-adjusted values |
| current prices | Nominal values (not adjusted) |
| per capita | Per person |
| YoY | Year-over-year |
| QoQ | Quarter-over-quarter |
Large Numbers
| Abbreviation | Value |
|---|---|
| K | Thousand (1,000) |
| M | Million (1,000,000) |
| B | Billion (1,000,000,000) |
| T | Trillion (1,000,000,000,000) |