National Income Accounting
In making the above estimate, Petty introduces in the first two chapters of Verbum Sapienti the first rigorous assessments of national income and wealth. To him, it was all too obvious that a country’s wealth lay in more than just gold and silver. He worked off an estimation that the average personal income was £6 13s 4d per annum, with a population of six million, meaning that national income would be £40m. Petty produces estimates, some more reliable than others, for the various components of national income, including land, ships, personal estates and housing. He then distinguishes between the stocks (£250m) and the flows yielding from them (£15m). The discrepancy between these flows and his estimate for national income (£40m) leads Petty to postulate that the other £25m is the yield from what must be £417m of labour stock, the value of the people. This gives a total wealth for England in the 1660s of £667m.
Read more about this topic: William Petty
Famous quotes containing the words national, income and/or accounting:
“[Wellesley College] is about as meaningful to the educational process in America as a perfume factory is to the national economy.”
—Nora Ephron (b. 1941)
“Work though we must, our jobs do not automatically determine our priorities concerning our marriages, our children, our social life, or even our health. It’s still life, constrained as it may be by limited disposable income or leisure time, and we’re still responsible for making it something we enjoy or endure.”
—Melinda M. Marshall (20th century)
“I, who am king of the matter I treat, and who owe an accounting for it to no one, do not for all that believe myself in all I write. I often hazard sallies of my mind which I mistrust.”
—Michel de Montaigne (1533–1592)