Stocks and Flows in the System of National Accounts

Vocabulary flashcards covering key terms from Lecture 3 on Stocks and Flows in the System of National Accounts.

System of National Accounts (SNA)

International statistical framework that records economic production, consumption, accumulation, income, wealth, and the related stocks and flows of institutional units.

Stocks

Positions or holdings of assets and liabilities at a specific point in time; the cumulative result of past flows.

Flows

Economic values created, transformed, exchanged, transferred, or extinguished during a period, causing changes in stocks.

Economic Flow

Any movement of economic value—transactional or other—that alters an institutional unit’s assets or liabilities.

Economic Benefit

Gain or positive utility from economic activity (production, consumption, accumulation), often received as money, goods, or services.

Ownership

Entitlement to claim the benefits of an entity, distinguished as legal or economic.

Legal Ownership

Right, conferred by law, to claim and enjoy the benefits of an entity such as goods, services, or financial assets.

Economic Ownership

Ability to claim benefits from using an entity while assuming the associated risks, irrespective of legal title.

Asset

Store of value providing benefit(s) to the economic owner over time and carrying value forward between periods.

Liability

Obligation of a debtor to make payment(s) to a creditor under specified conditions.

Constructive Liability

Obligation arising from long-standing custom rather than a formal contract, giving the creditor a valid expectation of payment.

Institutional Unit

Economic entity (household, corporation, government agency, etc.) that owns assets, incurs liabilities, and engages in transactions.

Balance Sheet

Account showing an institutional unit’s stocks of assets and liabilities at the start or end of an accounting period.

Transaction

Economic flow resulting from mutual agreement between institutional units, or analytically treated internal action, recorded in monetary terms.

Monetary Transaction

Transaction in which parties express their agreement in units of currency, involving a payment or financial claim.

Non-monetary Transaction

Transaction not initially stated in currency; value must be estimated for SNA recording purposes.

Barter

Two-party non-monetary transaction exchanging goods or services directly without money.

Remuneration in Kind

Non-monetary payment to labor in the form of goods or services instead of cash.

Payments in Kind (other than compensation)

Provision or receipt of goods/services without cash that is not related to wage compensation.

Transfers in Kind

Non-monetary transfers of goods or services provided without a direct counterpart, e.g., humanitarian aid.

Other Flows

Changes in asset or liability values not caused by transactions, such as revaluations, natural disasters, or uncompensated seizures.

Central Framework (of SNA)

Core structure describing production, consumption, accumulation, and related economic phenomena using basic categories like Who? What? and Why?

Accumulation

Process of acquiring or disposing of assets and liabilities over time, linking flows to resulting changes in stocks.

Production

Economic activity that creates goods or services.

Consumption

Use of goods or services to satisfy needs or wants.

Debtor

Institutional unit that is obligated to make payments under a liability.

Creditor

Institutional unit entitled to receive payments arising from a financial claim.