<p>There is no special technical jargon for it. You can call it equivalence or three sided equivalence between income, expenditure and production.</p>
<p>However, that’s not really a term but rather a description you could use for any arbitrary equivalence <span class="math-container">$X\equiv Y \equiv Z$</span>.</p>

CC BY-SA 4.0
2024-01-30T10:27:52.513Z
2024-01-30T10:27:52.513Z
1muflon1
<p>This is best thought of an an equilibrium outcome. In equilibrium, the value of goods and services sold (Income) has to equal the value of goods and services bought (Expenditure) and goods and services created (Produced). Yes, there are tricky cases, like changes in inventories, but thinking of this as an equilibrium gets you almost all the way there.</p>

CC BY-SA 4.0
2024-01-30T21:02:28.147Z
Are you implying that an economy could be in a disequilibrium in which the three quantities were not all equal?
Adam Bailey
CC BY-SA 4.0
2024-01-30T21:10:21.283Z
These things hold also outside equilibrium. Profits + wages + rent + interest = consumption expenditure + investment exp + government exp + spending on NX always holds by construction same way as A=L+E holds in accounting even when firm is not in stable equilibrium. That’s just identity. Regarding output it depends on type of output. Even outside equilibrium it would be equal to gross output (again just an identity) but it wouldn’t be equal to potential output necessarily
1muflon1
CC BY-SA 4.0
2024-01-30T14:26:12.617Z
2024-01-30T14:26:12.617Z
BKay
<p>Wikipedia says</p>
<blockquote>
<p>GDP can be determined in three ways, all of which should, theoretically, give the same result. They are the production (or output or value added) approach, the income approach, and the speculated expenditure approach. It is representative of the total output and income within an economy.</p>
</blockquote>
<p><a href="https://en.m.wikipedia.org/wiki/Gross_domestic_product" rel="nofollow noreferrer">https://en.m.wikipedia.org/wiki/Gross_domestic_product</a></p>
<p>In Japanese, it is called <a href="https://ja.m.wikipedia.org/wiki/%E4%B8%89%E9%9D%A2%E7%AD%89%E4%BE%A1%E3%81%AE%E5%8E%9F%E5%89%87" rel="nofollow noreferrer">三面等価の原則</a>.</p>
<p>What is the English word for this?</p>

<macroeconomics><gdp><definition>
What is the name of the principle "GDP=Production=Income=Expenditure"?
user46190
# What is the name of the principle "GDP=Production=Income=Expenditure"?

(Asked by: username_0 on 2024-01-30)

Wikipedia says

> GDP can be determined in three ways, all of which should, theoretically, give the same result. They are the production (or output or value added) approach, the income approach, and the speculated expenditure approach. It is representative of the total output and income within an economy.

<https://en.m.wikipedia.org/wiki/Gross_domestic_product>

In Japanese, it is called [三面等価の原則](https://ja.m.wikipedia.org/wiki/%E4%B8%89%E9%9D%A2%E7%AD%89%E4%BE%A1%E3%81%AE%E5%8E%9F%E5%89%87).

What is the English word for this?

**Tags:** macroeconomics, gdp, definition

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## 2 answers

### Answer by username_1 on 2024-01-30. Score: 1

There is no special technical jargon for it. You can call it equivalence or three sided equivalence between income, expenditure and production.

However, that’s not really a term but rather a description you could use for any arbitrary equivalence $X\equiv Y \equiv Z$.


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### Answer by username_2 on 2024-01-30. Score: 0

This is best thought of an an equilibrium outcome. In equilibrium, the value of goods and services sold (Income) has to equal the value of goods and services bought (Expenditure) and goods and services created (Produced). Yes, there are tricky cases, like changes in inventories, but thinking of this as an equilibrium gets you almost all the way there.

> **Comments:**
> **username_3**: Are you implying that an economy could be in a disequilibrium in which the three quantities were not all equal?  
> **username_1**: These things hold also outside equilibrium. Profits + wages + rent + interest = consumption expenditure + investment exp + government exp + spending on NX always holds by construction same way as A=L+E holds in accounting even when firm is not in stable equilibrium. That’s just identity. Regarding output it depends on type of output. Even outside equilibrium it would be equal to gross output (again just an identity) but it wouldn’t be equal to potential output necessarily  

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