Countries by Income Group

The United Nations (UN,) instead, relies on a more complex classification that includes geographic regions as well as such categories as least developed countries (like Afghanistan and Malawi,) landlocked developing countries (e.g., Botswana, Azerbaijan,) small island developing states (e.g., Bahamas, Mauritius,) transition countries (e.g., Belarus, Croatia), developed regions (Japan, Northern America,) and developing regions (Central America, Asia excluding Japan.)

The term “Newly industrialized country” (NIC) is also useful and is applied to countries whose economies have not yet reached “advanced” or “developed” status but have outpaced their developing counterparts. These are countries that are experiencing industrialization and rapid economic growth, such as China, India, Brazil, Malaysia, Philippines and Thailand.

Finally, one system that used to be popular but has fallen out of favor is to divide the world into First-World, Second-World, Third-World and Fourth-World countries. This system was based more on a country’s position in the hierarchy of global power than on its economic status (although the two were often related.) First introduced by the United Nations, its use became widespread during the Cold War. Generally, it grouped countries aligned with the United States and NATO into the First World, the Soviet Union and its allies into the Second World, and non-aligned countries into the Third World. The term Fourth World was sometimes used to refer to extremely poor nations and, at other times, to mean marginal or “stateless” people such as aboriginal cultures within a nation.

World Bank List Of Economies By Income Group
(FY2015)

In this classification, countries are divided in the following income groups:

• Group 1 | Low income: $1,045 or less
• Group 2 | Lower middle income: $1,046 to $4,125
• Group 3 | Upper middle income: $4,126 to $12,745
• Group 4 | High income: $12,746 or more