What is Gross Value Added (GVA) & How is it different from GDP? – Concept of Economy – Free PDF

• So earlier we learned about GDP which is the sum total of Final goods and services produced in a country.
• GVA which stands for Gross Value added which measures the total value added by each sector of the economy.
• Value added is defined as the Value of Output – value of intermediate consumption.

• GVA tells the contribution of a particular sector of an economy in the total output.

• GVA measures the growth of the country on the basis of value-based approach.
• GDP measures the of the country on the basis of the volume of production in the country.
• Gross value added (GVA) adds up the value of all goods and services produced in an economy after deducting the input costs,

While

• Gross domestic product (GDP) is a measure of the country’s national income by adding up the expenditures in the economy.

How GDP and GVA are linked

GDP = GVA + Taxes earned by the government — subsidies provided by the government

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