Abstract

GOMEZ D'ANGELO, Walter. Terms of Trade, GDP and Real Domestic Income in Bolivia. rlde [online]. 2016, n.26, pp.45-68. ISSN 2074-4706.

Quantifying real domestic income from Real GDP figures is acceptable for economies with low or moderate level of external openness, and also with a diversified export sector. However, for economies such as that of Bolivia, with a high level of external openness and with exports concentrated in a handful of primary products, using real GDP as an indicator of real domestic income is ill-advised, and may lead to serious errors in the analysis of economic variables. For these economies, the preferred indicator of domestic income and economic well-being is Real Gross Domestic Income (Real GDI). This concept (Real GDI) includes real income gains (or losses) brought out by changes in foreign trade prices.

Keywords : Gross Domestic Product; Gross Domestic Income; Terms of Trade; Economic Growth.

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