A measure of a country’s economic activity, it represents the total value of all finished goods and services produced by a nation’s citizens, regardless of their location. This includes products and services generated both within the country’s borders and abroad. For instance, if a U.S. citizen owns a factory in another country, the value of the goods produced there would be included in the U.S.’s measurement, but not the other country’s.
This metric offers insights into a nation’s overall economic health and its citizens’ contributions to global production. It provides a broader perspective than other measures that only consider domestic production because it accounts for the income earned by a nation’s residents from investments and activities abroad. Historically, it has been used to compare the economic output of different countries and to track economic growth or decline over time. Understanding this allows geographers to analyze the spatial distribution of economic activity and the interconnectedness of national economies.