3.3 What does GDP include ...

Gross domestic product or GDP is defined as including

Furthermore, GDP includes the grey economy, and it should also include illegal economic activities. The grey economy refers to legal economic activities on which (for one reason or another) there are no official records. In and of itself, grey economy is perfectly legal activity - working on a building site or running a restaurant, for example - but the operation does not have the necessary permits or fails to submit the required official reports (to evade social security contributions or taxes, for instance). Illegal economic activity, then, is one that is in breach of the law, such as drug trafficking. EU Member States aim to include in their GDP figures the illegal activities of prostitution (in Finland procuration), smuggling and drug trade.

As for own-account production by households, GDP includes the production and processing of agricultural products for own use, housing construction (including holiday homes) and in principle all goods production of economic significance. A value is also calculated for owner-occupied housing: since rented accommodation is included in GDP, it is necessary to include owner-occupied housing as well. The ratio between rented accommodation and owner-occupied accommodation varies widely between different countries, and comparisons would be very difficult if the national accounts figures only included rented housing. Imputed figures are determined for owner-occupied dwellings using floor area, rent and other similar factors.