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Noah Smith

Not All Developing Nations Are Created Equal

The crude categories used to define a country’s economic status fail to capture differences and potential.

A category that’s hard to escape.

A category that’s hard to escape.

Photographer: Florian Plaucheur/AFP/Getty Images

Economists tend to categorize countries by their per-capita income levels. The best known is the World Bank’s system, which classifies countries into low, lower-middle, upper-middle and high income, according to the per capita gross national income:

Other international development agencies, like the International Monetary Fund and the United Nations, tend to adopt the World Bank’s taxonomy when distinguishing countries by income. An alternative system, used by the United Nations Development Program, is the Human Development Index, which includes measures like health and education as well as income.