The national income and product accounts use several related terms when discussing the size of the economy and sectors within the economy, such as transportation. These terms are used both in some of the figures in this chapter and other discussions of transportation economics.

• What is Gross Domestic Product (GDP) and Gross Domestic Demand (GDD)?

  • GDP is the sum of the value of all goods and services produced in the U.S. economy.

  • GDD is similar to GDP but excludes net exports, showing only domestic demand.

• What are the differences among transportation value added, total transportation expenditures, transportation-related final demand, and the value of all shipments?

  • Transportation Value Added is a measure of the size of the transportation sector based on the difference between the value of the transportation services sold and the goods and services used to produce transportation. The Bureau of Economic Analysis considers industry value added to be a measure of an industry’s contribution to GDP.

  • Total Transportation Expenditure measures what is spent on transportation without deducting the value of goods and services that are inputs. The main additional components are employee compensation and returns to capital.

  • Transportation-Related Final Demand shows the impact of transportation as a factor in the demand for goods and services in the economy.

  • Value of Shipments is the value of the goods transported by the freight transportation sector which is not the same as the value of the service of transporting them.