While per capita gross domestic product is the indicator most commonly used to compare national income levels, two other measures are preferred by many analysts. These are per capita Gross National Income (GNI) and Net National Income (NNI). Whereas GDP refers to the income generated by production activities on the economic territory of the country, GNI measures the income generated by the residents of a country, whether earned in the domestic territory or abroad. NNI is the aggregate value of the balances of net primary incomes summed over all sectors.

Disposable income, as a concept, is closer to the concept of income generally understood in economics, than either national income or GDP. At the total economy level it differs from national income in that additional income items are included, mainly other current transfers such as remittances. For countries where these additional items form significant sources of income the importance of focusing on disposable income in formulating policy is clear. Another important difference between national income and disposable income reflects the fact that the latter concerns the share of national income that is allocated to households only. Disposable income can be seen as the maximum amount that a household can afford to spend on the consumption of goods or services without having to reduce its financial or non-financial assets or by increasing its liabilities.

Household savings is the main domestic source of funds to finance capital investment, which is a major driver of long-term economic growth. Household savings rates vary considerably between countries because of institutional, demographic and socio-economic differences. For example, government provisions for old-age pensions and the demographic age structure of the population will influence the rate at which populations save (older persons tend to run down their financial assets during their retirement to the detriment of savings). Equally the availability and price of credit, as well as attitudes towards debt, may influence choices made by individuals regarding whether to spend or save.

Income inequalities are one of the most visible manifestations of differences in living standards within each country. In many OECD countries, income inequalities reflect developments in the labour market, as well as in tax and transfer systems.

Avoiding economic hardship is a primary objective of social policy. As perceptions of “a decent standard of living” vary across countries and over time, no commonly agreed measure of “absolute” poverty across OECD countries exists. A starting point for measuring poverty is therefore to look at “relative” poverty, whose measure is based on the income that is most typical in each country in each year.

Along with income, wealth is a key measure of households’ economic resources. Households hold both non-financial and financial wealth. The structure of financial assets affects households financial risks as different types of securities carry different risk levels.

The household debt ratio measures the indebtedness of households in relation to their income, that is their spending and saving capacity. High debt ratios are often interpreted as a sign of financial vulnerability though one should also take into account the availability of assets (e.g. dwellings) in such an assessment. High indebtedness levels generally increase the financing costs of the borrower, deteriorate balance sheet positions and may restrict access to new financing.

Non-financial assets held by households reflect the assets owned by unincorporated household enterprises and dwellings owned by households, with the latter representing by far the bulk of non-financial assets held by households. They form an important part of overall wealth and can provide an important additional source of revenue; either through their sale or refinancing, or as income via rentals of residential property for example. Estimates of non-financial assets held by households also play an important role in economic analyses, such as studies of asset bubbles, and analyses of living standards.