Glossary
Gross domestic product (GDP)
The total market value of goods and services produced in a country over a period; the broadest measure of economic output.
Gross domestic product (GDP) is the market value of all final goods and services produced within a country's borders during a given period. It is the most widely used gauge of the size of an economy and, through its growth rate, of whether that economy is expanding. In the US it is compiled by the Bureau of Economic Analysis (BEA) and released quarterly; US nominal GDP was roughly $29 trillion in 2024.
How it is measured
The most familiar method adds up spending on final output:
"Final" matters: the steel sold to a carmaker is not counted separately, because its value is already included in the car. Transfers such as Social Security payments are not in G, since they do not buy output directly.
Nominal versus real, and what GDP leaves out
Nominal GDP uses current prices; real GDP adjusts for inflation so that growth reflects more output rather than higher prices. The quarterly headline investors watch is the real GDP growth rate.
GDP is a measure of production, not of welfare. It ignores unpaid household work, the distribution of income and environmental costs, and it can rise after a disaster as rebuilding adds spending. For markets, the composition and the surprise relative to forecasts usually matter more than the level.