[OPE-L:5732] Re: Question about NIPA

Allin Cottrell (cottrell@wfu.edu)
Mon, 17 Nov 1997 09:55:31 -0500 (EST)

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On Fri, 14 Nov 1997, andrew kliman wrote:

> I was wondering if someone could answer a question of mine
> about the national income and product accounts...

> So my question is, why do they say that only production of
> "final" goods and services is included? If the NIPA are
> correct, then this isn't correct, because new factories
> (plant), machines (equipment), and stocks of steel, coal,
> fabrics, etc. (inventories) are definitely not "final"
> goods -- they re-enter production.

Isn't their definition of "final" relative to the accounting
period? That is, goods are "final" if they are either (a)
consumed (other than in production), or (b) carried over to
the next period. Intermediate goods are those produced and
used up in production within the period. That's the way
I've read it anyway.

Allin Cottrell
Department of Economics
Wake Forest University