Net Foreign Factor Income (NFFI)

You’ve heard of gross domestic product (GDP), and gross national product (GNP)... what’s the difference again? Net factor foreign income (NFFI) is the difference.

But what is that, again? Well, GDP is the economic output in geographic terms, within borders (think of the D, “domestic”), whether it’s made my locals or foreigners. GNP, on the other hand, is the economic output by people of the nation (think of the N, “national”), no matter where they live. So, if you are a digital nomad from the U.S., you’re contributing to GDP and GNP when you’re in the U.S., but only to GNP when you’re nomading outside of the U.S.

Net foreign factor income is GNP minus GDP, so what the people of a nation are making no matter where they are, minus the economic growth made within the nation. As more people are moving around, the net foreign factor income is growing more and more important.