Net national income (NNI) is an economics term used in national income accounting. It can be defined as the net national product (NNP) minus indirect taxes. Net national income encompasses the income of households, businesses, and the government.
It can be expressed as:
NNI = C + I + G + (NX) + net foreign factor income - indirect taxes - manufactured capital depreciation
where:
- C = Consumption
- I = Investments
- G = Government spending
- NX = net exports (exports minus imports)
- NX also can be written as (X-M) which determines current account
This formula uses the expenditure method of national income accounting.
When net national income is adjusted for natural resource depletion, it is called Adjusted Net National Income expressed as below:
NNI* = C + I + G + NX + Net Foreign Factor Income - Indirect Taxes - manufactured capital depreciation - Natural Resource Depletion
Natural resource refers to non-critical natural capital like minerals. NNI* does not take critical natural capital into account. Examples are air, water, land, etc.
For reference, capital (K) is divided into four categories:
- K_m : manufactured capital (machines, factories, etc)
- K_h : human capital (workers' skills)
- K_n : non-critical natural capital (minerals)
- K_h* : critical natural capital (air, water)
Famous quotes containing the words net, national and/or income:
“Mental events such as perceivings, rememberings, decisions, and actions resist capture in the net of physical theory.”
—Donald Davidson (b. 1917)
“Reporters for tabloid newspapers beat a path to the park entrance each summer when the national convention of nudists is held, but the cult’s requirement that visitors disrobe is an obstacle to complete coverage of nudist news. Local residents interested in the nudist movement but as yet unwilling to affiliate make observations from rowboats in Great Egg Harbor River.”
—For the State of New Jersey, U.S. public relief program (1935-1943)
“Happy are those who find wisdom, and those who get understanding, for her income is better than silver, and her revenue better than gold. She is more precious than jewels, and nothing you desire can compare with her. Long life is in her right hand; in her left hand are riches and honor. Her ways are ways of pleasantness, and all her paths are peace. She is a tree of life to those who lay hold of her; those who hold her fast are called happy.”
—Bible: Hebrew, Proverbs 3:13-18.