Flow variable
Also called: Flows · Topic: National Income Accounting: GDP, GVA and Welfare · NCERT: Class 12, Ch 2 "National Income Accounting"; Class 12, Ch 3 "Money and Banking"
Meaning
A flow variable is measured over a period of time, such as a month or a year. Examples are income, output, profits, investment, depreciation, value added and change in inventories. A flow figure is incomplete unless you state the time period. GDP is a flow, because it measures output produced in a year.
Example
"Salary ₹10,000" means little until you add "per month" or "per year". In a tank, the water flowing in through the tap each minute is a flow.
Don't confuse with
- Stock variable: a stock is measured at a point of time. The water already in the tank, or the capital stock on 31 March, is a stock.
Related concepts
- Final goods
- Intermediate goods
- Consumer goods
- Consumer durables
- Capital goods
- Double counting
- Stock variable
- Investment
- Gross investment
- Depreciation