What's net factor income?

Net factor income is the difference between a country's total factor income received from abroad and the total factor income paid to foreign entities. It is calculated by subtracting the total factor income paid to foreign entities (such as wages, profits, and interest) from the total factor income received from abroad. Net factor income is an important component of a country's balance of payments and is used to measure the overall economic performance of a country in terms of its international trade and investment activities.

Net factor income is the income earned by residents of a country from production factors such as labor and capital that are used in the production of goods and services in other countries. It is calculated as the difference between the income earned by residents of a country from their ownership of assets in other countries and the income earned by non-residents from their ownership of assets in the country.

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