Arvonlisäykseen

Arvonlisäys is a Finnish term that translates to "value added" in English. It is a fundamental economic concept used to measure the contribution of a particular economic activity or business to the overall production of goods and services. In essence, it represents the increase in value that a company or industry creates by transforming raw materials or intermediate goods into final products or services.

The calculation of value added typically involves subtracting the cost of intermediate consumption (inputs purchased from other businesses) from the value of output produced. This difference signifies the value that the producer has added through their labor, capital, and innovation. Value added can be measured at the firm level, industry level, or even at the national economy level.

In national accounting, gross value added (GVA) is a key indicator of economic performance. It is a measure of output less intermediate consumption and is used to calculate gross domestic product (GDP). GVA provides a better picture of the contribution of different sectors to the economy than simply looking at total sales, as it avoids the issue of double-counting. For example, a car manufacturer's value added would be the price of the car minus the cost of all the parts and materials they purchased from suppliers.

Understanding value added is crucial for economic analysis, policy-making, and business strategy. It helps to identify which sectors are most productive, where economic growth is originating, and how different industries contribute to wealth creation. Businesses use the concept to assess their efficiency and profitability.