What is the difference between GDP and GNP deflator base year?

The difference between GDP and GNP deflator base year lies in the measures they represent. GDP (Gross Domestic Product) is a measure of the total value of all goods and services produced within a country's borders in a specific period, typically a year. It reflects the economic activity within a country.

On the other hand, GNP (Gross National Product) represents the total value of all goods and services produced by a country's residents, regardless of their location, in a specific period. It includes the income earned by a country's residents from abroad and excludes the income earned by foreigners within the country.

The base year for GDP deflator is the year used as a reference point to calculate the inflation-adjusted GDP. It is used to measure the change in the overall price level of goods and services produced within a country. The GDP deflator base year is typically set to 100, and changes in the index reflect changes in the general price level over time.

In contrast, the GNP deflator base year is used to measure the change in the overall price level of goods and services produced by a country's residents, regardless of their location. It serves as an indicator of inflation within a country's overall economic output.

In summary, GDP measures the value of goods and services produced within a country's borders, while GNP measures the value of goods and services produced by a country's residents. The base year for GDP deflator is used to calculate inflation-adjusted GDP, while the GNP deflator base year is used to measure inflation within a country's overall economic output.