Meaning: -In ordinary sense, national income refers to the total value of
goods and services produced in a country during a particular year. In a broader
sense, the national income can be viewed from three angles.
·
Production Angle
·
Distribution Angle
·
Disposition Angle
Definitions: -The
national divided or income consists solely of services as received by ultimate
consumers whether from their human environments. Thus a piano or an overcoat
made for me this year is not a part of this year’s income, but an addition to
capital. Only the services rendered to me during this year by these things are
income”
Defined by..................... Irvin Fisher
Following are the some of the important Features of
National Income
1.
Macro economic
concept: - The National income is a study of
Macro economics concept. It is the aggregate income of all goods and services
produced in a country during a given year. It provides a clear picture
country’s economic performance during a particular year.
2.
Flow concept: - National income is a flow concept i.e. flow of goods and
services produced in the economy during a year. It varies according to
variations in production within the country. National income flows only if
there is productivity activity in the economy.
3.
Real terms and Money
Terms: - The national income can be expressed
in real terms as well as in money terms.
·
Real National Income: - when
national income is expressed as a flow of goods and services produced in the
economy in a year, it is called as real national income.
·
Money National Income: -When
national income is expressed as the value of all goods and services produced in
the economy during a year, it is called as money national income.
4.
Value of final goods and services:
-While calculating national income, only the value
of final goods and services is included. The value of intermediate goods such
as raw materials is not included. This is done to avoid double counting.
5.
Transfer Income: -While calculating national income, the transfer income in the form of old age pension,
unemployment allowances, scholarships, etc., is not included. The transfer
income is received by receipts without providing any factor unit such as
labour, capital, etc.
6.
Financial Year: - In India, the national income is estimated by Central
Statistical Organisation. It is annually estimated and measured for a financial
year beginning from 1st April and ending on 31st March.
