Revolutionizing Economic Development: A Decade-by-Decade Analysis of the World Bank’s Income Categorizations

Since 1987, the World Bank Group has classified countries into four income categories based on their Gross National Income (GNI) per capita. These classifications are updated annually on July 1 and use the Atlas method to calculate GNI measurements in US dollars. The Atlas method was introduced in 1989 and is still used today to indicate a country’s level of development.

The classification of countries into income categories has changed significantly since the late 1980s. In 1987, only 30% of reporting countries were considered low-income, while 25% were classified as high-income. However, by 2023, these ratios had shifted dramatically, with only 12% falling into the low-income category and 40% in the high-income category.

It’s worth noting that these changes in income classifications vary greatly across regions. For example, some regions have seen a significant decrease in the percentage of countries classified as low-income, while others have seen an increase in high-income classifications over time. These shifts reflect the economic growth and development of countries within each region.

Overall, the World Bank’s income classifications serve as an important indicator of a country’s level of development and economic capacity. By tracking these trends over time, we can gain a better understanding of how different regions are progressing economically and identify areas where additional support may be needed to promote further growth and development.