Net domestic product as a basis for the analysis and forecasting of economic development

Using actual data, it is shown that the current practice of determining the volume of production on the basis of gross domestic product, which includes material costs in the form of consumption of fixed capital, leads to an incorrect evaluation of the volume, dynamics, and structure of production and the use of value added. Net domestic product that does not include material costs, using an estimate of fixed capital and its consumption at their replacement value, is proposed as the main indicator of national accounts in Russia. This will also help to obtain reliable data on national wealth, primarily of the value of its most active part, namely, the reproducible capital stock, which must also be determined by the replacement value. The data obtained from the determination of the gross domestic product can be stored for international comparisons, because currently not all countries have data necessary to calculate net domestic product.