Actually, in these PC days they call it Gross Domestic Product (GDP) . National has become a dirty word in PC circles. But it was GNP when I went to school and I am not PC. The statistic began to be computed in the 1930's as a measure of an economy's war potential. The Americans managed to shift a third of their massive GNP into war production by 1945, and that buried the enemy under an avalanche of ammunition, rations, tanks, jeeps, warplanes, army trucks, aircraft carriers, radar sets, and finally nuclear weapons.
GNP is defined as the total output of goods and services, expressed in dollars, and figured on a yearly basis. Goods is easy enough to understand, goods are packed in cartons, stacked on loading docks, shipped to customers. Services used to be necessary things like transportation (rail, shipping, trucking) or utilities (electricity, water, sewage) As time went on, service providers of lesser importance wanted the prestige of being included in GNP figures. In the UK they now include the services of "sex workers" and there is a push to include housekeeping and child care into GNP figures.
The Economist did not explore a few issues in GNP computation. Consider automobile production. Clearly number of new cars produced times the average sales price of new cars goes into GNP. But, consider this, Detroit doesn't make everything that goes into a new car. They buy tires, batteries, spark plugs, wire, fasteners, glass, paint, sheet steel, lotta stuff from other companies. Think about that spark plug company, Champion say. They ship a lotta plugs to Detroit, which have an average sales price. That goes into GNP as well as the new cars do. In this case the plugs get counted twice, once as the leave the spark plug company, and a second time as they leave the auto plant, securely screwed into the engine of the new car.
Then how do you handle big construction projects. Say the World Trade Center. That took years to build. Did they estimate the amount done each year and add that into GNP? Or do they wait until the building is finished and sold? We are talking of a billion dollar project here. Lumping years of work into the last year gives you a GNP bump in the year the job finishes. And what does 9/11 do to GNP? Do they even count that in GNP?
Anyhow the Economist devoted a full page to GNP calculation this week.