Before GNP: The debate that shaped the most important national statistic of the 20th century

Abstract

Gross National Product (GNP), it is one of the most common abbreviations in economics and has become a mainstay in discussions of political economics. Gross National Product is the means by which we measure national income. It is an aggregate statistic that represents the value of national production and has become one of the primary indicators of the development of a national economy. As much as it is present in contemporary economics and political economics, the definition and method of compiling national income and GDP are only 70 years old making it a fairly modern construct. In recent years, GNP has become one of the most criticised statistical figures in contemporary society and we can wonder to what extent the criticisms towards GNP today were already familiar to the people who inverted and standardised the concept. This thesis sets out to look at GNP and national income from a historical perspective prior to the standardisation of these concepts. It will discuss the debate between three of the most prominent scholars in the field of national income between the 1930s and 1950s: Simon Kuznets, Richard Stone and Milton Gilbert, about the definitions of national income and the method of national accounting. In doing so it seeks find out how the standardised definitions and concepts for the measurement of Gross National Product and national income came about?