The World Bank's Classification of Countries by Income
The World Bank has used an income classification to group countries for analytical purposes for many years. Since the present income classification was first introduced 25 years ago there has been significant change in the global economic landscape...
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World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2016/01/25737491/world-banks-classification-countries-income http://hdl.handle.net/10986/23628 |
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okr-10986-236282021-04-23T14:04:16Z The World Bank's Classification of Countries by Income Fantom, Neil Serajuddin, Umar CURRENCY BASKET BORROWER DEVELOPMENT ASSISTANCE ACCOUNTING FOREIGN DEBT DEPOSITS PRICE LEVELS GNP DEFLATOR DEVELOPING COUNTRIES VALUATION STRUCTURAL CHANGE FOREIGN EXCHANGE MARKET INCOME INTEREST OPTION EXCHANGE INTERNATIONAL FINANCIAL MARKETS DEVELOPING COUNTRIES ACCOUNTING FRAMEWORK DEBTOR EXCHANGE RATE INSTABILITY WELFARE BONDS MIDDLE INCOME COUNTRY VARIABLES CREDITWORTHINESS PRICING PRICE BENCHMARKS INPUTS TURNOVERS RESERVE CENTRAL BANKS INTERNATIONAL TRANSACTIONS INFLATION INTERNATIONAL BANK TRENDS BANK LENDING BUDGET CONVERSION DEVELOPMENT CHOICE INFLUENCE GLOBAL ECONOMY PER CAPITA INCOME CURRENCY DEVELOPMENT ECONOMICS RESERVE BANK ACCESS TO FINANCING GNP CONVERSIONS EXCHANGE RATES BASE YEAR OPTIONS MONETARY FUND GLOBALIZATION GROSS NATIONAL PRODUCT EMERGING MARKET CRITERIA MARKETS DEBT RETURN FINANCIAL FLOWS INTERNATIONAL DEVELOPMENT INTERPOLATION INCOME LEVELS TRADE POLICY PRODUCT RESERVES END USE AVERAGING GROSS DOMESTIC PRODUCT MONETARY AUTHORITIES MARKET TURNOVERS FINANCE FOREIGN CURRENCY TAXES PRICE INFLATION INCOME MEASURES TRANSACTIONS INTERNATIONAL STANDARDS COLLECTION PROCESS FEDERAL RESERVE FOREIGN EXCHANGE RESERVES GOOD FEDERAL RESERVE BANK WAGES DEFLATORS INTERNATIONAL TRADE VOLATILITY COLLECTION PROCEDURES FUTURE VALUE CREDIT FIXED CAPITAL PURCHASING POWER NATIONAL INCOME REPAYMENT EXPENDITURES ECONOMY CAPITAL FLOWS BIDS MEASUREMENT INSTITUTIONAL CAPACITY SHARES MARKET BENCHMARK CREDIT RATING FOREIGN EXCHANGE LOCAL CURRENCY BIDDING INFLATION RATES MACROECONOMIC VARIABLES HOLDINGS CURRENCIES ECONOMIC DEVELOPMENT TRADE GDP GOODS THEORY GLOBAL TRADE GENERALIZED SYSTEM OF PREFERENCES EXTREME POVERTY SHARE POVERTY FINANCIAL MARKETS INTERNATIONAL STANDARD PURCHASING INSTITUTIONAL DEVELOPMENT OVERVALUATION PROFIT FINANCIAL SUPPORT LENDING EXCHANGE RATE GDP DEFLATOR OUTCOMES ARREARS WORLD MARKET MIDDLE INCOME COUNTRIES LOCAL INFLATION PRICES INCOME LEVEL PRODUCTION COSTS DEVELOPMENT POLICY HUMAN DEVELOPMENT The World Bank has used an income classification to group countries for analytical purposes for many years. Since the present income classification was first introduced 25 years ago there has been significant change in the global economic landscape. As real incomes have risen, the number of countries in the low income group has fallen to 31, while the number of high income countries has risen to 80. As countries have transitioned to middle income status, more people are living below the World Banks international extreme poverty line in middle income countries than in low income countries. These changes in the world economy, along with a rapid increase in the user base of World Bank data, suggest that a review of the income classification is needed. A key consideration is the views of users, and this paper finds opinions to be mixed: some critics argue the thresholds are dated and set too low; others find merit in continuing to have a fixed benchmark to assess progress over time. On balance, there is still value in the current approach, based on gross national income per capita, to classifying countries into different groups. However, the paper proposes adjustments to the methodology that is used to keep the value of the thresholds for each income group constant over time. Several proposals for changing the current thresholds are also presented, which it is hoped will inform further discussion and any decision to adopt a new approach. 2016-01-12T22:23:56Z 2016-01-12T22:23:56Z 2016-01 Working Paper http://documents.worldbank.org/curated/en/2016/01/25737491/world-banks-classification-countries-income http://hdl.handle.net/10986/23628 English en_US Policy Research Working Paper;No. 7528 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
CURRENCY BASKET BORROWER DEVELOPMENT ASSISTANCE ACCOUNTING FOREIGN DEBT DEPOSITS PRICE LEVELS GNP DEFLATOR DEVELOPING COUNTRIES VALUATION STRUCTURAL CHANGE FOREIGN EXCHANGE MARKET INCOME INTEREST OPTION EXCHANGE INTERNATIONAL FINANCIAL MARKETS DEVELOPING COUNTRIES ACCOUNTING FRAMEWORK DEBTOR EXCHANGE RATE INSTABILITY WELFARE BONDS MIDDLE INCOME COUNTRY VARIABLES CREDITWORTHINESS PRICING PRICE BENCHMARKS INPUTS TURNOVERS RESERVE CENTRAL BANKS INTERNATIONAL TRANSACTIONS INFLATION INTERNATIONAL BANK TRENDS BANK LENDING BUDGET CONVERSION DEVELOPMENT CHOICE INFLUENCE GLOBAL ECONOMY PER CAPITA INCOME CURRENCY DEVELOPMENT ECONOMICS RESERVE BANK ACCESS TO FINANCING GNP CONVERSIONS EXCHANGE RATES BASE YEAR OPTIONS MONETARY FUND GLOBALIZATION GROSS NATIONAL PRODUCT EMERGING MARKET CRITERIA MARKETS DEBT RETURN FINANCIAL FLOWS INTERNATIONAL DEVELOPMENT INTERPOLATION INCOME LEVELS TRADE POLICY PRODUCT RESERVES END USE AVERAGING GROSS DOMESTIC PRODUCT MONETARY AUTHORITIES MARKET TURNOVERS FINANCE FOREIGN CURRENCY TAXES PRICE INFLATION INCOME MEASURES TRANSACTIONS INTERNATIONAL STANDARDS COLLECTION PROCESS FEDERAL RESERVE FOREIGN EXCHANGE RESERVES GOOD FEDERAL RESERVE BANK WAGES DEFLATORS INTERNATIONAL TRADE VOLATILITY COLLECTION PROCEDURES FUTURE VALUE CREDIT FIXED CAPITAL PURCHASING POWER NATIONAL INCOME REPAYMENT EXPENDITURES ECONOMY CAPITAL FLOWS BIDS MEASUREMENT INSTITUTIONAL CAPACITY SHARES MARKET BENCHMARK CREDIT RATING FOREIGN EXCHANGE LOCAL CURRENCY BIDDING INFLATION RATES MACROECONOMIC VARIABLES HOLDINGS CURRENCIES ECONOMIC DEVELOPMENT TRADE GDP GOODS THEORY GLOBAL TRADE GENERALIZED SYSTEM OF PREFERENCES EXTREME POVERTY SHARE POVERTY FINANCIAL MARKETS INTERNATIONAL STANDARD PURCHASING INSTITUTIONAL DEVELOPMENT OVERVALUATION PROFIT FINANCIAL SUPPORT LENDING EXCHANGE RATE GDP DEFLATOR OUTCOMES ARREARS WORLD MARKET MIDDLE INCOME COUNTRIES LOCAL INFLATION PRICES INCOME LEVEL PRODUCTION COSTS DEVELOPMENT POLICY HUMAN DEVELOPMENT |
| spellingShingle |
CURRENCY BASKET BORROWER DEVELOPMENT ASSISTANCE ACCOUNTING FOREIGN DEBT DEPOSITS PRICE LEVELS GNP DEFLATOR DEVELOPING COUNTRIES VALUATION STRUCTURAL CHANGE FOREIGN EXCHANGE MARKET INCOME INTEREST OPTION EXCHANGE INTERNATIONAL FINANCIAL MARKETS DEVELOPING COUNTRIES ACCOUNTING FRAMEWORK DEBTOR EXCHANGE RATE INSTABILITY WELFARE BONDS MIDDLE INCOME COUNTRY VARIABLES CREDITWORTHINESS PRICING PRICE BENCHMARKS INPUTS TURNOVERS RESERVE CENTRAL BANKS INTERNATIONAL TRANSACTIONS INFLATION INTERNATIONAL BANK TRENDS BANK LENDING BUDGET CONVERSION DEVELOPMENT CHOICE INFLUENCE GLOBAL ECONOMY PER CAPITA INCOME CURRENCY DEVELOPMENT ECONOMICS RESERVE BANK ACCESS TO FINANCING GNP CONVERSIONS EXCHANGE RATES BASE YEAR OPTIONS MONETARY FUND GLOBALIZATION GROSS NATIONAL PRODUCT EMERGING MARKET CRITERIA MARKETS DEBT RETURN FINANCIAL FLOWS INTERNATIONAL DEVELOPMENT INTERPOLATION INCOME LEVELS TRADE POLICY PRODUCT RESERVES END USE AVERAGING GROSS DOMESTIC PRODUCT MONETARY AUTHORITIES MARKET TURNOVERS FINANCE FOREIGN CURRENCY TAXES PRICE INFLATION INCOME MEASURES TRANSACTIONS INTERNATIONAL STANDARDS COLLECTION PROCESS FEDERAL RESERVE FOREIGN EXCHANGE RESERVES GOOD FEDERAL RESERVE BANK WAGES DEFLATORS INTERNATIONAL TRADE VOLATILITY COLLECTION PROCEDURES FUTURE VALUE CREDIT FIXED CAPITAL PURCHASING POWER NATIONAL INCOME REPAYMENT EXPENDITURES ECONOMY CAPITAL FLOWS BIDS MEASUREMENT INSTITUTIONAL CAPACITY SHARES MARKET BENCHMARK CREDIT RATING FOREIGN EXCHANGE LOCAL CURRENCY BIDDING INFLATION RATES MACROECONOMIC VARIABLES HOLDINGS CURRENCIES ECONOMIC DEVELOPMENT TRADE GDP GOODS THEORY GLOBAL TRADE GENERALIZED SYSTEM OF PREFERENCES EXTREME POVERTY SHARE POVERTY FINANCIAL MARKETS INTERNATIONAL STANDARD PURCHASING INSTITUTIONAL DEVELOPMENT OVERVALUATION PROFIT FINANCIAL SUPPORT LENDING EXCHANGE RATE GDP DEFLATOR OUTCOMES ARREARS WORLD MARKET MIDDLE INCOME COUNTRIES LOCAL INFLATION PRICES INCOME LEVEL PRODUCTION COSTS DEVELOPMENT POLICY HUMAN DEVELOPMENT Fantom, Neil Serajuddin, Umar The World Bank's Classification of Countries by Income |
| relation |
Policy Research Working Paper;No. 7528 |
| description |
The World Bank has used an income
classification to group countries for analytical purposes
for many years. Since the present income classification was
first introduced 25 years ago there has been significant
change in the global economic landscape. As real incomes
have risen, the number of countries in the low income group
has fallen to 31, while the number of high income countries
has risen to 80. As countries have transitioned to middle
income status, more people are living below the World Banks
international extreme poverty line in middle income
countries than in low income countries. These changes in the
world economy, along with a rapid increase in the user base
of World Bank data, suggest that a review of the income
classification is needed. A key consideration is the views
of users, and this paper finds opinions to be mixed: some
critics argue the thresholds are dated and set too low;
others find merit in continuing to have a fixed benchmark to
assess progress over time. On balance, there is still value
in the current approach, based on gross national income per
capita, to classifying countries into different groups.
However, the paper proposes adjustments to the methodology
that is used to keep the value of the thresholds for each
income group constant over time. Several proposals for
changing the current thresholds are also presented, which it
is hoped will inform further discussion and any decision to
adopt a new approach. |
| format |
Working Paper |
| author |
Fantom, Neil Serajuddin, Umar |
| author_facet |
Fantom, Neil Serajuddin, Umar |
| author_sort |
Fantom, Neil |
| title |
The World Bank's Classification of Countries by Income |
| title_short |
The World Bank's Classification of Countries by Income |
| title_full |
The World Bank's Classification of Countries by Income |
| title_fullStr |
The World Bank's Classification of Countries by Income |
| title_full_unstemmed |
The World Bank's Classification of Countries by Income |
| title_sort |
world bank's classification of countries by income |
| publisher |
World Bank, Washington, DC |
| publishDate |
2016 |
| url |
http://documents.worldbank.org/curated/en/2016/01/25737491/world-banks-classification-countries-income http://hdl.handle.net/10986/23628 |
| _version_ |
1764454373459492864 |