Rationale and definition:

Gross national income measures the total earnings of the residents of an economy adjusted for the cost of living in each country (purchasing power parity, PPP). These earnings are defined as the sum of value added by all resident producers, plus any product taxes (less subsidies) not included in the valuation of output, plus net receipts of primary income (compensation of employees and property income) from abroad. The International Comparison Program (ICP) can be used to compute purchasing power parity (PPP) adjustments. The Atlas method is a World Bank method of computing exchange rates to reduce the impact of market fluctuations in the cross-country comparison of national incomes.

Disaggregation:

Spatially (rural/urban, province/district).

Comments and limitations:

As underscored in this report, GNI and GDP are important indicators, but they measure only part of the economic dimension of sustainable development. Both economic measures do not adequately capture people’s material conditions.¹

We therefore recommend that they be complemented by other “beyond GDP” indicators (see also Table 1 in the report). For example, the System of Environmental-Economic Accounting 2012 Central Framework will help support a wider set of indicators related to sustainable development and green growth, which aims at fostering economic growth while ensuring that natural resources continue to provide the resources and environmental services on which wellbeing relies. The environmental- economic framework makes it possible to create indicators linking poverty reduction and natural resource management. Interdependencies related to food security and nutrition should also be considered. These issues are central to pro-poor growth and social protection policies in developing countries.

Preliminary assessment of current data availability by Friends of the Chair:

A

Primary data source:

Administrative data.

Potential lead agency or agencies:

The UN Statistics Division, the World Bank and the IMF compile GNI data.