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Developed country

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"Industrial nation" redirects here. For the magazine, see Industrialisation.
For the investing classification, see Developed market.

World map indicating the categories of Human Development Index by country (based on 2015 data, published on 24 March 2017).
  Very high (Developed)
  High (Developing)
  Medium (Developing)
  Low (Undeveloped)
  Data unavailable

A developed country, industrialized country, more developed country, or "more economically developed country" (MEDC), is a sovereign state that has a highly developed economy and advanced technological infrastructure relative to other less industrialized nations. Most commonly, the criteria for evaluating the degree of economic development are gross domestic product (GDP), gross national product (GNP), the per capita income, level of industrialization, amount of widespread infrastructure and general standard of living.[1] Which criteria are to be used and which countries can be classified as being developed are subjects of debate.

Developed countries have post-industrial economies, meaning the service sector provides more wealth than the industrial sector. They are contrasted with developing countries, which are in the process of industrialization, or undeveloped countries, which are pre-industrial and almost entirely agrarian. As of 2015, advanced economies comprise 60.8% of global GDP based on nominal values and 42.9% of global GDP based on purchasing-power parity (PPP) according to the International Monetary Fund.[2] In 2015, the ten largest advanced economies by GDP in both nominal and PPP terms were Australia, Canada, France, Germany, Italy, Japan, South Korea, Spain, the United Kingdom, and the United States.[3]

Similar terms

See also: North–South divide

Terms similar to developed country include "advanced country", "industrialized country", "'more developed country" (MDC), "more economically developed country" (MEDC), "Global North country", "first world country", and "post-industrial country". The term industrialized country may be somewhat ambiguous, as industrialization is an ongoing process that is hard to define. The first industrialized country was the United Kingdom, followed by Belgium. Later it spread further to Germany, United States, France and other Western European countries. According to some economists such as Jeffrey Sachs, however, the current divide between the developed and developing world is largely a phenomenon of the 20th century.[4]

Definition and criteria

Economic criteria have tended to dominate discussions. One such criterion is income per capita; countries with high gross domestic product (GDP) per capita would thus be described as developed countries. Another economic criterion is industrialization; countries in which the tertiary and quaternary sectors of industry dominate would thus be described as developed. More recently another measure, the Human Development Index (HDI), which combines an economic measure, national income, with other measures, indices for life expectancy and education has become prominent. This criterion would define developed countries as those with a very high (HDI) rating.

According to the United Nations Statistics Division:

There is no established convention for the designation of "developed" and "developing" countries or areas in the United Nations system.[5]

And it notes that:

The designations "developed" and "developing" are intended for statistical convenience and do not necessarily express a judgement about the stage reached by a particular country or area in the development process.[6]

Human Development Index (HDI)

Main articles: Human Development Index and List of countries by Human Development Index

The UN HDI is a statistical measure that gauges a country's level of human development. While there is a strong correlation between having a high HDI score and a prosperous economy, the UN points out that the HDI accounts for more than income or productivity. Unlike GDP per capita or per capita income, the HDI takes into account how income is turned "into education and health opportunities and therefore into higher levels of human development."

Since 1990, Norway (2001–2006, 2009–2013), Japan (1990–1991 and 1993), Canada (1992 and 1994–2000) and Iceland (2007–2008) have had the highest HDI score. The top 47 countries have scores ranging from 0.793 in Barbados to 0.955 in Norway.

Many countries listed by IMF or[Note 1] CIA as "advanced" (as of 2009), possess an HDI over 0.788 (as of 2010). Many countries[Note 2] possessing an HDI of 0.788 and over (as of 2010) are also listed by IMF or CIA as "advanced" (as of 2009). Thus, many "advanced economies" (as of 2009) are characterized by an HDI score of 0.9 or higher (as of 2007). Since April 2016, the IMF classifies Macau as an advanced economy.[7]

The latest report was launched on 21 March 2017.[8]

Complete list of countries

  • Increase = increase.
  • Steady = steady.
  • Decrease = decrease.

Very high human development

As a non-UN member, the government of Taiwan calculates its own HDI, which had a value of 0.882 in 2011.[9] Additionally, while the HDI for the Chinese special administrative region of Hong Kong is calculated by the UN, it is not for Macau. The Macanese government calculated the territory's HDI to be 0.868 in 2011. These values place both Taiwan and Macau well within the list of countries with "Very high human development".[10] Furthermore, in 2009 a United Nations project calculated the HDI for all of its members, as well as Taiwan, Macau, and many dependent territories. The HDI values for the countries of San Marino and Monaco, which have not been included in official annual HDI reports, were found to be at 0.961 and 0.956 respectively. This places both countries firmly within the category of countries with "Very high human development" as well. The dependent territories with HDI values equivalent to "Very high human development" were: Jersey, Cayman Islands, Bermuda, Guernsey, Gibraltar, Norfolk Island, Faroe Islands, Isle of Man, British Virgin Islands, Falkland Islands, Aruba, Puerto Rico, Martinique, Greenland, and Guam.[11] Of note, the HDI values in the 2009 report were calculated using the old HDI formula, while HDI values after the year 2010 are calculated with a different formula.

Other lists of developed countries

Some institutions have produced lists of developed countries: the UN (list shown above), the CIA,[12] and some providers of stock market indices(the FTSE Group, MSCI, S&P, Dow Jones, STOXX, etc.). The latter is not included here because its association of developed countries with countries with both high incomes and developed markets is not deemed as directly relevant.[why?][Note 3]

However many other institutions have created more general lists referred to when discussing developed countries. For example, the International Monetary Fund (IMF) identifies 39 "advanced economies".[7][13] The OECD's 35 members are known as the "developed countries club"[14][15][16] The World Bank identifies 79 "high income countries".[17]

World Bank high-income economies

World Bank high-income economy map

According to the World Bank the following 79 countries (including territories) are classified as "high-income economies".[17] In parentheses are the year(s) during which they held such classification since classification began in 1987.[18]

IMF advanced economies

  Countries described as Advanced Economies by the IMF

According to the International Monetary Fund, the following 39 economies are classified as "advanced economies":[7]

The CIA has modified an older version of the IMF's list of Advanced Economies, noting that the IMF's Advanced Economies list "would presumably also cover"[12] some smaller countries. These include:

See also: The World Factbook list of developed countries

High-income OECD members

There are 33 members in the High-income OECD category, as determined by the World Bank.[19][20] The High-income OECD membership is as follows:

25 countries in Europe:

3 countries in Asia:

3 countries in the Americas:

2 countries in Oceania:

Development Assistance Committee members

Member nations of the Development Assistance Committee

There are 35 OECD member countries and the European Union—in the Development Assistance Committee (DAC),[21] a group of the world's major donor countries that discuss issues surrounding development aid and poverty reduction in developing countries.[22] The following OECD member countries are DAC members:

25 countries wholly or partly in Europe:

3 countries in Asia:

4 countries in North America:

2 countries in Oceania:

Paris Club members

Permanent members of the Paris Club

There are 22 permanent members in the Paris Club (French: Club de Paris), a group of officials from major creditor countries whose role is to find coordinated and sustainable solutions to the payment difficulties experienced by debtor countries.

15 countries wholly or partly in Europe:

3 countries in Asia:

3 countries in The Americas:

1 country in Oceania:

Disposable Income per capita (OECD)

The list below represents a national accounts derived indicator based on adjusted gross income, which is defined as "the balance of primary incomes of an institutional unit or sector by adding all current transfers, except social transfers in kind, receivable by that unit or sector and subtracting all current transfers, except social transfers in kind, payable by that unit or sector; it is the balancing item in the Secondary Distribution of Income Account" [23] "plus transfers in kind" received mainly from government, such as healthcare and education.[24] It is based on the national accounts, which follows a standardized accounting (System of National Accounts) so to allow for comparability. It is also not survey based, which avoids survey errors and underreporting. The following is published by the OECD and is presented in PPPs so to adjust for costs of living.

See also

Notes

  1. ^ The official classification of "advanced economies" is originally made by the International Monetary Fund (IMF). The IMF list doesn't deal with non-IMF members. The Central Intelligence Agency (CIA) intends to follow IMF list but adds few economies which aren't dealt with by IMF due to their not being IMF members. By May 2001, the advanced country list of the CIA was more comprehensive than the original IMF list. However, since May 2001, three additional countries (Cyprus, Malta and Slovenia) have been added to the original IMF list, thus leaving the CIA list not updated.
  2. ^ Namely sovereign states, i.e., excluding Macau: In 2003, the government of Macau calculated its HDI as being 0.909 (the UN does not calculate Macau's HDI); In January 2007, the People's Daily reported (from China Modernization Report 2007): "In 2004... Macau... had reached the level of developed countries". The UNCTAD organisation (of the UN), as well as the CIA, classify Macau as a "developing" territory. The World Bank classifies Macau as a high income economy (along with developed economies as well as with few developing economies).
  3. ^ The Developed Countries Glossary entry reads: "The following countries are classified by FTSE as developed countries: Australia, Austria, Belgium/Luxembourg, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong (People's Republic of China), Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, South Korea, Spain, Sweden, Switzerland, United Kingdom and the United States."

References

  1. ^ Developed Economy Definition. Investopedia (2010-04-16). Retrieved 2013-07-12.
  2. ^ IMF GDP data (October 2015)
  3. ^ "Gross domestic product, current prices & Gross domestic product based on purchasing-power-parity (PPP) valuation of country GDP". World Economic Outlook Database, October 2015. International Monetary Fund. October 2015. Retrieved 2015-10-15.
  4. ^ Sachs, Jeffrey (2005). The End of Poverty. New York, New York: The Penguin Press. ISBN 1-59420-045-9. {{cite book}}: Cite has empty unknown parameter: |coauthors= (help)
  5. ^ "Composition of macro geographical (continental) regions, geographical sub-regions, and selected economic and other groupings (footnote C)". United Nations Statistics Division. 17 October 2008. Retrieved 2008-12-30.
  6. ^ United Nations Statistics Division- Standard Country and Area Codes Classifications (M49). Unstats.un.org. Retrieved 2013-07-12.
  7. ^ a b c IMF Advanced Economies List. World Economic Outlook, April 2016, p. 148
  8. ^ a b c d e f g h i "Human Development Report 2016 – 'Human Development for Everyone'" (PDF). HDRO (Human Development Report Office) United Nations Development Programme. Retrieved 11 April 2017.
  9. ^ "2011中華民國人類發展指數 (HDI)" (PDF) (in Chinese). Directorate General of Budget, Accounting and Statistics, Executive Yuan, R.O.C. 2011. Retrieved 2011-11-21.
  10. ^ Macau in Figures, 2013
  11. ^ Filling Gaps in the Human Development Index, United Nations ESCAP, February 2009
  12. ^ a b CIA (2008). "Appendix B. International Organizations and Groups". World Factbook. Retrieved 2008-04-10.
  13. ^ World Economic Outlook, International Monetary Fund, September 2011, p. 165.
  14. ^ http://www.hungarianquarterly.com/no160/104.shtml
  15. ^ Indiana Express
  16. ^ Minutes of Forum #26:Global Strategy Series 2 - Japan as It Should Be (Outline) | Economic and Social Research Institute, Cabinet Office, Government of Japan. Esri.go.jp. Retrieved 2013-07-12.
  17. ^ a b Country and Lending Groups. World Bank. Retrieved August 1, 2016.
  18. ^ "How does the World Bank classify countries?". World Bank. Retrieved 2016-08-01.
  19. ^ Country and Lending Groups | Data. Data.worldbank.org. Retrieved 2016-08-01.
  20. ^ "Members and partners". OECD. Retrieved 1 August 2016.
  21. ^ Peer reviews of DAC members - Organisation for Economic Co-operation and Development. Oecd.org. Retrieved 2013-10-22.
  22. ^ DAC website >> "The DAC in Dates", On the DAC's self-description, see the introductory letter. On other events, refer to the relevant section by date.
  23. ^ OECD Glossary of Statistical Terms - Disposable income Definition
  24. ^ OECD Glossary of Statistical Terms - Adjusted disposable income Definition
  25. ^ [1]
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