# Confusion between percentage and percentage point

I am struggling to interpret a interaction term.

A 1% point increase in military expenditure growth, leads to a X% point change in GDP growth.

what is a 1% point increase in military expenditure growth? i.e. is it a 1% point increase in the rate of increase of military growth. For example from 5% to 6%.

OR

is it 5% -> 5.005%

and how does this relate to the actual variable military expenditure not the military expenditure growth?

My model is of the form:

whereby the deltalog(variable) = growth of (variable)

My thesis supervisor has told me that "a 1 percentage point increase in the growth of military expenditure as a % of GDP, is associated with a beta percentage point increase in the growth of GDP per Capita."

I am just trying to wrap my head around the meaning of this? Would it be an increase in the rate of increase of GDP?

Any help greatly appreciated

thanks

• stats.stackexchange.com/questions/337847/… – oneloop Apr 1 '18 at 20:40
• @oneloop thanks, but rather I am after the intuition, as a 1% change is different to 1% point - thats the thing im after.. – Stat-metrics Apr 1 '18 at 20:48
• If you can provide information on the data set and the model you are using, this will help others prepare their responses. – Gregg H Apr 1 '18 at 21:01
• @GreggH Sorry about that i shall edit my original message – Stat-metrics Apr 1 '18 at 21:39