How is the economy growth/decline of the entire country determined ?
In: Economics
Think of economy like a giant lemonade stand. If we sell more lemonade (goods/services) than last year, we’re growing. If less, we’re in decline.
A country generally has a bureau that keeps track of economic activity. They often poll industry groups to find out how specific industries are performing. They also aggregate data about shipping loads, mining, manufacturing and agriculture. From these varied sources they build a mathematical model of the economy and that tells them what the GDP (gross domestic product) is and whether the economy is growing or shrinking.
In the US the National Bureau of Economic Research (which is a private non-partisan non-profit organization) does a lot of the work of this. The government also has multiple groups that do data for more specific segments and industries.
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