Exclusions From GDP

Exclusions From GDPBuying and Selling Securities- When a person buys securities, there is only an exchange of ownership rights. No productive activity occurs.

Government Transfer Payments: Payments for which no productive services are concurrently provided in exchange. Ex- Social Security, Welfare, Pell Grants, SubsidiesPrivate Transfer Payments- a transfer of money from one person to another with no productive activity taking place.

Transfer of Secondhand Goods- Only ownership rights are exchanged. The productive activity took place at an earlier time.

Household Production- Production is not sold in the market.

Underground and Illegal Economic Activities- Since the value of activities are not reported, they can not be included in GDP