Gross Domestic Product (GDP): 12 Things to Know (2024)

GDP is the “big number” when it comes to tracking the size and growth of an economy, but it does not tell the full story of how well people are doing in a country.

1. Gross Domestic Product (GDP) measures the value of goods and services produced within an economy’s borders during a given period.
   Source: Economic and Financial Indicators Technical Notes

2. GDP is measured by national governments and by some international organizations, which rely primarily on government data. These include the International Monetary Fund, the World Bank and the Asian Development Bank.
   Source: Asian Development Outlook

3. Tracking gross domestic product is important because it provides a general assessment of the state of a country’s economy. Generally, if the GDP is growing, companies are expanding and there are more jobs available.
   Source: Gross Domestic Product: An Economy’s All

4. There is a strong correlation between high GDP growth in a society and the reduction of poverty, particularly severe poverty.
   Source: Report of the Eminent Persons Group to The President of the Asian Development Bank

5. Asia as a region has enjoyed strong economic growth for decades, currently contributing about 60% of global GDP growth, and now accounts for more than 40% of world GDP.
   Source: Expanding Economies in Asia Deliver 60% of Global Growth

6. This rapid economic growth is credited with lifting more than 700 million Asians out of poverty.
   Source: Rich-Poor Divide Deepens in Asia

7. While rapid GDP growth is associated with reduced poverty, it has also been linked to rising disparities in income and wealth – creating a greater divide between the rich and poor – which could affect political stability.
   Source: Report of the Eminent Persons Group to The President of the Asian Development Bank

8. Between the 1990s and 2000s, while economic growth soared in Asia, income inequality worsened in four of the five most populous countries: Bangladesh, the People’s Republic of China, India, and Indonesia. These countries account for nearly 80% of the population of developing Asia.
   Source: Income Inequality and Inclusive Growth in Developing Asia

9. GDP growth is not a panacea, and complementary policies may be required to address various economic ailments. Though jobs have increased in Asia with economic growth, many workers earn too little to lift their families out of poverty and thsoewithout formal work exceed 40% of the total employed in 18 countries in Asia. In India and Bangladesh, it is over 80%.
   Source: Key Indicators for Asia and the Pacific 2013

10. To extract the benefits of GDP growth while minimizing the detrimental effects, many governments are working toward “inclusive growth,” which seeks to ensure that the opportunities created by economic growth are available to all, particularly the poor.
    Source: Report of the Eminent Persons Group to The President of the Asian Development Bank

11. The Asian Development Bank supports inclusive growth by investing in infrastructure that not only drives growth but also connects the poor to markets and increases their access to basic services.
    Source: Inclusive Growth
12. ADB is also investing in education and health and essential public services, such as water and sanitation, which encourage economic growth while directly benefiting the poor.
    Source: Inclusive Growth