Developed country

"Industrial nation" redirects here. For the industrial music magazine, see Industrialnation.

Further information: Developed market
World map by quartiles of Human Development Index in 2014.
  Very High
  High
  Medium
  Low
  Data unavailable

A developed country, industrialized 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. According to the International Monetary Fund, advanced economies comprise 65.8% of global nominal GDP and 52.1% of global GDP (PPP) in 2010.[2] In 2014, the ten largest advanced economies by nominal GDP were the United States, Japan, Germany, France, the United Kingdom, Italy, Canada, Australia, South Korea and Spain. By PPP GDP, they were the United States, Japan, Germany, France, the United Kingdom, Italy, South Korea, Canada, Spain and Australia.[3]

Similar terms

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)

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 (1990–91 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).

The latest index was released on 24 July 2014 and covers the period up to 2013. The following are the 49 countries in the top quartile - having an HDI above 0.8, and classified as possessing a "Very high human development".

Rank Country HDI
New 2014 estimates for 2013
[7]		 Change in rank between 2014 report to 2013 report[7] New 2014 estimates for 2013
[7]		 Change compared between 2014 report and 2013 report
[7]
1 Steady  Norway 0.944 Increase 0.001
2 Steady  Australia 0.933 Increase 0.002
3 Steady   Switzerland 0.917 Increase 0.001
4 Steady  Netherlands 0.915 Steady
5 Steady  United States 0.914 Increase 0.002
6 Steady  Germany 0.911 Steady
7 Steady  New Zealand 0.910 Increase 0.002
8 Steady  Canada 0.902 Increase 0.001
9 Increase (3)  Singapore 0.901 Increase 0.003
10 Steady  Denmark 0.900 Steady
11 Decrease (3)  Ireland 0.899 Decrease 0.002
12 Decrease (1)  Sweden 0.898 Increase 0.001
13 Steady  Iceland 0.895 Increase 0.002
14 Steady  United Kingdom 0.892 Increase 0.002
15 Steady  Hong Kong 0.891 Increase 0.002
15 Increase (1)  South Korea 0.891 Increase 0.003
17 Decrease (1)  Japan 0.890 Increase 0.002
18 Decrease (2)  Liechtenstein 0.889 Increase 0.001
19 Steady  Israel 0.888 Increase 0.002
20 Steady  France 0.884 Steady
21 Steady  Austria 0.881 Increase 0.001
21 Steady  Belgium 0.881 Increase 0.001
21 Steady  Luxembourg 0.881 Increase 0.001
24 Steady  Finland 0.879 Steady
25 Steady  Slovenia 0.874 Steady
Rank Country HDI
New 2014 estimates for 2013
[7]		 Change in rank between 2014 report to 2013 report[7] New 2014 estimates for 2013
[7]		 Change compared between 2014 report and 2013 report
[7]
26 Steady  Italy 0.872 Steady
27 Steady  Spain 0.869 Steady
28 Steady  Czech Republic 0.861 Steady
29 Steady  Greece 0.853 Decrease 0.001
30 Steady  Brunei Darussalam 0.852 Steady
31 Steady  Qatar 0.851 Increase 0.001
32 Steady  Cyprus 0.845 Decrease 0.003
33 Steady  Estonia 0.840 Increase 0.001
34 Steady  Saudi Arabia 0.836 Increase 0.003
35 Increase (1)  Lithuania 0.834 Increase 0.003
35 Decrease (1)  Poland 0.834 Increase 0.001
37 Steady  Andorra 0.830 Steady
37 Increase (1)  Slovakia 0.830 Increase 0.001
39 Steady  Malta 0.829 Increase 0.002
40 Steady  United Arab Emirates 0.827 Increase 0.002
41 Increase (1)  Chile 0.822 Increase 0.003
41 Steady  Portugal 0.822 Steady
43 Steady  Hungary 0.818 Increase 0.001
44 Steady  Bahrain 0.815 Increase 0.002
44 Steady  Cuba 0.815 Increase 0.002
46 Decrease (2)  Kuwait 0.814 Increase 0.001
47 Steady  Croatia 0.812 Steady
48 Steady  Latvia 0.810 Increase 0.002
49 Decrease  Argentina 0.808 Decrease 0.003

As a non-UN member, the government of Taiwan calculates its own HDI, which had a value of 0.882 in 2011.[8] 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".[9] 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, and Guam.[10] 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.

Net take-home pay of OECD members

While GDP per capita is often used to measure how developed a country is, it includes components that do not contribute to a citizen's standard of living. GDP per capita may increase while real incomes for the majority decline. However, measuring only net take-home pay gives a more accurate picture of a country's standard of living. The tables show net income figures published annually in the OECD Tax Database.[11] They reflect the annual augmented total net take-home pay, by family-type, deducting taxes and non-tax compulsory payments. Since PPP conversion is a widely accepted way to compare income, the OECD publishes the data in USD PPPs. The two major family-types, married with 2 children and single with no child at 100% average wage have been selected to give an accurate picture of the wage levels. Note that Turkey has been omitted from the tables for consistency due to its wage figures being based on the old definition of average worker.

Married with 2 children at 100% of average wage[12]

Rank Country 2013 net income
in USD PPP
1  Luxembourg 55,387
2   Switzerland 50,817
3  Australia 46,334
4  Norway 46,311
5  Germany 45,687
6  Belgium 43,034
7  United States 42,433
8  South Korea 42,050
9  Ireland 41,459
10  United Kingdom 41,451
11  Japan 40,491
12  Austria 40,011
13  Netherlands 38,804
14  Denmark 37,405
15  Iceland 37,312
16  Sweden 37,092
17  France 36,009
18  Finland 35,546
19  New Zealand 35,503
20  Canada 35,471
21  Spain 32,416
22  Italy 32,200
23  Greece 27,073
24  Israel 26,808
25  Slovenia 26,367
26  Portugal 24,939
27  Czech Republic 23,926
28  Hungary 19,419
29  Estonia 18,908
30  Slovakia 18,718
31  Poland 17,986
32  Chile 15,366
33  Mexico 11,140

Single with no child at 100% of average wage[12]

Rank Country 2013 net income
in USD PPP
1   Switzerland 46,346
2  Norway 42,166
3  South Korea 40,782
4  Luxembourg 40,709
5  Australia 40,481
6  United Kingdom 38,918
7  Japan 37,452
8  United States 36,549
9  Netherlands 36,426
10  Germany 34,945
11  Sweden 33,965
12  Austria 33,064
13  Ireland 32,660
14  Finland 32,651
15  Belgium 32,252
16  Denmark 31,880
17  France 31,489
18  Iceland 30,372
19  New Zealand 30,237
20  Canada 30,088
21  Spain 29,505
22  Italy 27,196
23  Israel 25,703
24  Greece 23,756
25  Portugal 20,900
26  Slovenia 19,767
28  Czech Republic 17,342
30  Estonia 16,751
29  Poland 16,445
27  Chile 15,366
31  Slovakia 15,227
32  Hungary 15,019
33  Mexico 11,140

Gallup median household and per-capita income

In 2013, Gallup published a list of countries with median per capita and household income.[13] Using median, rather than mean income, results in a much more accurate picture of the average income of the middle class since the data will not be skewed by gains and abnormalities in the extreme ends. The figures are in international dollars using purchasing power parity and are based on responses from at least 2,000 adults in each country, with the data aggregated from 2006 to 2012. Below is a list of the top 30 countries in each category.

Rank Country/Territory Household income
in USD PPP[13]
1  Luxembourg 52,493
2  Norway 51,489
3  Sweden 50,514
4  Australia 46,555
5  Denmark 44,360
6  United States 43,385
7  Canada 41,280
8  South Korea 40,861
9  Kuwait 40,854
10  Netherlands 38,584
11  New Zealand 35,562
12  Hong Kong 35,443
13  Austria 34,911
14  Finland 34,615
15  Japan 34,822
16  Germany 33,333
17  Taiwan 32,762
18  Singapore 32,360
19  United Kingdom 31,617
20  France 31,112
21  Israel 30,364
22  Belgium 26,703
23  Qatar 26,555
24  Slovenia 25,969
25  Ireland 25,085
26  Saudi Arabia 24,980
27  Bahrain 24,633
28  Czech Republic 22,913
29  Spain 21,959
30  Italy 20,085
Rank Country/Territory Per-capita income
in USD PPP[13]
1  Norway 19,308
2  Sweden 18,632
3  Luxembourg 18,418
4  Denmark 18,262
5  Finland 15,725
6  United States 15,480
7  Canada 15,181
8  Australia 15,026
9  Netherlands 14,450
10  Germany 14,098
11  France 12,445
12  United Kingdom 12,399
13  Austria 12,284
14  New Zealand 12,147
15  South Korea 11,350
16  Japan 10,840
17  Belgium 10,189
18  Hong Kong 9,705
19  Slovenia 8,656
20  Ireland 8,048
21  Israel 7,847
22  Czech Republic 7,821
23  Kuwait 7,487
24  Singapore 7,345
25  Spain 7,284
26  Taiwan 6,882
27  Italy 6,874
28  Malta 6,869
29  Greece 6,086
30  Portugal 5,519

Other lists of developed countries

Only three institutions have produced lists of "developed countries". The three institutions and their lists are the UN list (shown above), the CIA[14] list and the FTSE Group's list, whose list is not included because its association of developed countries with countries with both high incomes and developed markets is not deemed as directly relevant here.[Note 3] However many institutions have created lists which are sometimes referred to when people are discussing developed countries. The International Monetary Fund (IMF) identifies 37 "advanced economies",[15][16] The OECD, also widely known as the "developed countries club"[17][18][19] has 34 members. The World Bank identifies 74 "high income countries". The EIU's Quality-of-life survey and a list of countries with welfare states are also included here. The criteria for using all these lists and for countries' inclusion on these lists are often not properly spelt out, and several of these lists are based on old data.

IMF advanced economies

  Countries described as Advanced Economies by the IMF.

According to the International Monetary Fund the following 37 economies are classified as "advanced economies":[15]

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"[14] some smaller countries. These include:

High-income OECD members

There are 31 members in the High-income OECD category, as determined by the World Bank.[20] The High-income OECD membership is as follows:

23 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 29 members — 28 selected 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:

22 countries in Europe:

2 countries in Asia:

2 countries in North America:

2 countries in Oceania:

Newsweek's "world's best countries"

Newsweek published in 2010 a list of the "world's best countries", measuring "education, health, quality of life, economic dynamism, and political environment" in 100 countries. The top 30 countries are:[23]

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". However, Macau is not recognized by any international organisation as a developed/advanced territory, while 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 on 2013-07-12.
  2. ↑ IMF GDP data (September 2011)
  3. ↑ "Gross domestic product, current prices & Gross domestic product based on purchasing-power-parity (PPP) valuation of country GDP". World Economic Outlook Database, April 2012. International Monetary Fund. April 2012. Retrieved 2014-02-23.
  4. ↑ Sachs, Jeffrey (2005). The End of Poverty. New York, New York: The Penguin Press. ISBN 1-59420-045-9.
  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 on 2013-07-12.
  7. ↑ 7.0 7.1 7.2 7.3 7.4 7.5 7.6 7.7 "Human Development Report 2014 – "Sustaining Human Progress: Reducing Vulnerabilities and Building Resilience"". HDRO (Human Development Report Office) United Nations Development Programme. Retrieved 25 July 2014.
  8. ↑ "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.
  9. ↑ Macau in Figures, 2013
  10. ↑ Filling Gaps in the Human Development Index, United Nations ESCAP, February 2009
  11. ↑ OECD Tax Database
  12. ↑ 12.0 12.1 2013 OECD Tax Database, Tables S.5 and S.6 shows information on (augmented) total labour costs, net take-home pay and the changes in total labour costs and net take-home pay (updated April 2014) as a result of employer and employee NTCPs.
  13. ↑ 13.0 13.1 13.2 http://www.gallup.com/poll/166211/worldwide-median-household-income-000.aspx
  14. ↑ 14.0 14.1 CIA (2008). "Appendix B. International Organizations and Groups.". World Factbook. Retrieved 2008-04-10.
  15. ↑ 15.0 15.1 IMF Advanced Economies List. World Economic Outlook, April 2015, p. 150
  16. ↑ World Economic Outlook, International Monetary Fund, September 2011, p. 165.
  17. ↑ http://www.hungarianquarterly.com/no160/104.shtml
  18. ↑ http://www.indianexpress.com/old/ie/daily/19971214/34850733.html
  19. ↑ 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 on 2013-07-12.
  20. ↑ Country and Lending Groups | Data. Data.worldbank.org. Retrieved on 2013-07-12.
  21. ↑ Peer reviews of DAC members - Organisation for Economic Co-operation and Development. Oecd.org. Retrieved on 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. ↑ The world's best countries: 2010 index, Newsweek. Accessed on line August 15, 2010.

External links