GDP, or gross domestic product, reflects the economy in a particular region of the world. Though it makes sense to refer to states as having a GDP, you might run into situations where the economic performance of a state is referred to as the GSP, which stands for gross state product. Either way, for the sake of this article, we will be calling them GDP values.
When looking at GDP by state in the United States, the GDP helps inform people about how well a state's economy is doing. The GDP of a state refers to the overall production and distribution of goods in a state. You will find that GDP values are listed as dollar amounts because it is a monetary representation of how much a state either brought in or spent quarterly.
These are two different ways of viewing GDP in a country. The income approach is the former of the two, and it is defined by calculating how much money everyone in a certain location kept as profits over the course of a year. The expenditure method of determining GDP is the exact opposite way of calculating gross domestic product for a particular state. However, the value should still be relatively similar, if not identical. The expenditure method looks at how much money people spent in a given year, compared to how much they made in total.
The gross domestic product of a state is calculated every three months. With this quarterly system in place, the progression or digression of the GDP in each state can be seen so state governments can understand how their economy performed throughout the year. Looking at economic performance from one year to the next is important to see where the state is thriving and where the state could use additional effort. Still, it is more informative for the GDP values to reflect shorter periods.
Many changes occur on a month-to-month basis, and economies are already very fluctuating variables, so it makes more sense to view trends on a smaller scale than reflecting on GDP values once at the end of every year. Now that we understand that GDP values reflect economic performance, let's start looking at numbers.
The numbers in this article are the GDP for each state in Q4 of 2022 from the Bureau of Economic Analysis.
Real GDP increased in most states and the District of Columbia in Q4 of 2022. According to the U.S. Bureau of Economic Analysis the real GDP for the U.S. as a whole increased at an annual rate of 2.6%. The real GDP in individual states increased at an annual rate ranging from 175 in Texas to 0.3% in Michigan, and Maryland.
The ten states with the largest 2022 Q4 GDP (in millions of dollars) are
Four states contribute over $1 trillion to the U.S. GDP: California, Texas, New York, and Florida. California has the largest GDP of any state, at $3,120,386,000,000, accounting for about 14.7% of the country's total GDP. Texas follows with $1,772,132,000,000, about 8.4% of the country's total GDP.