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Unveiling the real contribution of final demand to GDP growth
This article focuses on the decomposition of real GDP growth in Portugal by components of final demand. Typically, the analysis of expenditure contributions to the real GDP growth does not take into account that part of the final demand is directly or indirectly satisfied by imports. This can lead to an overstatement of the real contribution of the components of final demand. Therefore, several methodological alternatives are considered aiming to remove the imports associated with each component of final demand from the corresponding contribution. In particular, a new approach is proposed that involves the annual estimation of the import content which in turn reflects expenditure structure and the respective evolution in volume over time, leading to more accurate results than the other alternatives considered.