GDP, Spillovers, and Human Capital

First read pages 62-63

Gross Domestic Product or GDP is the total value of goods and services a country produces in a year.

It is all the cars, Big Macs, pencils, clothes, etc made. As well as all services given like going to a doctor or lawyer for help.

GDP per capita is the value of goods and services produced per person

GDP is one of the main measures of how strong an economy is. The bigger the GDP the better the economy is.

In 2018 the GDP for the US was 20.54 trillion dollars

In 2018 China's GDP was 13.61 trillion dollars

In 2018 the Democratic Republic of the Congo's GDP was just 47 billion dollars

Developed countries have high GDP, good healthcare, and education

Developing countries are countries that have lower GDP and lower levels of healthcare and education

Human capital is the sum of all your education, skills, training and so on

Increasing your human capital can get you a better job and more wealth

Helpful and Harmful spillovers are things that can both help and harm an economy

For example if a factory is built in our town, a helpful spillover would be that people can get a job. An example of a harmful spillover would be that the factory would produce pollution