NEW ECONOMIC INDICATORS
Consumption is the use of a product in the process of satisfying needs. In the NEC2020 Concept, as well as in the Economic theory itself, consumption is equated with the acquisition of goods or services. However, the Concept considers the acquisition not as the conclusion and execution of a trivial sale and purchase agreement, but as a unique composite act of exchanging goods for money between the parties with an additional perpetual component called the Investment Deduction (see the article "New Economy of Consumption").
Despite the fact that the Economy ensures the existence and development of mankind, the Economic theory is full of contradictions, uncertainties and assumptions, which does not allow relying on it as a reliable foundation for building the future, using its laws as a guide to action, as a reliable roadmap that determines the path to achieve the goal. Economic theory does not provide recipes for gaining prosperity for the population of planet Earth. In addition to its disorder, economic theory does not provide reliable and verified ways to obtain reliable data that uniquely determine the state of the economy and the subjects of economic relations. Acquaintance with the existing Economic theory and Alternative Economic theories, gives the inquisitive mind the desire to take part in the creation of a new future Economic theory, which will replace the current one.
The materials published on this site give an understanding of the reasons for the appearance of the NEC2020 Concept and the aspirations of its Authors. The article "GDP as a problem" identifies shortcomings in the use of GDP as the main reliable universal indicator of the state of the economy and the fidelity of the goal of increasing it, as a prerequisite for improving the economic situation of the state and the welfare of its citizens. Without dwelling on the disadvantages already described, the Authors of the NEC2020 Concept, in the event that the practice of using the "New Economy of Consumption" is adopted and widely spread, they propose to introduce into the already used economic indicators, two new economic indicators, based on the Investment Deduction present in the NEC2020 Concept.
In the NEC2020 Concept, all the expenses of individuals are divided into three parts, one of which is defined as Investments and indirectly determines the well-being of the investor. The authors of the NEC2020 Concept propose to introduce additional economic parameters into economic statistics that will allow determining the financial situation of the country's inhabitants by calculating the amount of private financial investment and the amount of investment income received. Subject to the total use of the NEC2020 Concept in economic relations, the introduced new economic indicators will provide not only reliable statistics, but will also provide authentic data on the well-being of the entire population in general and in particular.
The first indicator received the abbreviation PFI (private financial investment). PFI is defined as the sum of all monetary resources that came from individuals to Investment Operators, through the sale of goods and services, in a certain period of time in the status of Investment deduction. The value of the PFI parameter and its change by reporting periods will provide reliable statistics on realized sales, including relative data on the total amount of sales and any discrete values. The PFI will provide information on the volume of private financial investments and their distribution by territory, economic sector, etc.
The second indicator that is proposed to be introduced is abbreviated PII (private investment income). The PII is the sum of all financial investment income that investors received during the reporting period, from all their investments that were realized through Investment Operators. The value of the PII parameter and its change over reporting periods will provide reliable statistics on the total passive income of the population and any discrete values. PII will provide statistics on the growth or decline of investment returns, the effectiveness of Investment Operators, the degree of private investment participation in the economy, an indirect assessment of the state of the economy, and other conclusions.
Introduction to the economic statistics of PFI and PII will provide a fairly objective picture of the well-being of the country's population, its confidence in the economic policy of the state, statistics on private investment in the country's economy, the parameter of investment return and other reliable numerical indicators. Comparison of PFI and PII data by time periods will provide reliable data on the well-being of participants in economic relations and on the state of the economy in dynamics.
Introduced new economic indicators PFI and PII, first of all, will provide reliable factual data that will report on the actual financial well-being of the population - growth or decline in a given "economic section" and in two meanings: "at the entrance" and "at the exit", which at least will complement the already existing methods of economic statistics that have similar goals.
Organized accounting and statistical processing of Investment deduction data will allow obtaining reliable unambiguous information on the following determinants (it is understood that the Investor is not limited in the number of Investment accounts, but can have only one Investment account with one of the Investment operators):
- number of Investors
- the number of Investment operators
- the number of Investment accounts with Investment operators
- the number of Investment accounts for each Investor
- the number of Investment Deductions for each Investor
- amounts for each of the Investment deductions and their distribution among the Investment accounts
- the total amount of Investment deductions on all Investment accounts for each Investor in a given period
- the total amount on the Investment accounts of each Investment operator
- Investment income for each Investment account for each Investor in a given period
- total Investment income for each Investor in a given period for all of his Investment accounts
- the size of the Investments directed by Investment operators into the economy
- distribution of Investments directed by Investment operators in various sectors of the economy
- profitability of Investments directed by Investment operators in various sectors of the economy
- efficiency of investment operators
- so on
Development of the private financial investment sector in a confidential and secure form for investors, is possible only with the participation of state legal regulation. The application of the NEC2020 Concept in the existing economic relations will attract the attention of citizens of such a state to investment activities, create a lot of intellectual jobs and investment enterprises, receive in the future a targeted injection of "dead money" into the country's economy, that is, "withdraw" money from the depreciating money storage by the population, most of whom will become investors, to motivate citizens' participation in the present and future of their your country
Article in ORIGINAL language HERE