In this chapter, we review the concept of national income and the economic theory of national income accounting. There are two building blocks – the ideas of Fisher, Lindahl, Hicks about income as an expenditure level that can be continued into the future, and the concept of income as a...

Ever since the early days of National Income accounting we can observe periodic surges of demands to fix the measurement of GDP to better reflect progress, welfare or even happiness. In recent years even Presidents and Prime Ministers in Europe have joined the chorus of the discontent. In this...