The World Bank’s income groups are widely used in global data. This article explains how they are defined and updated.

When people talk about countries as “rich” or “poor”, they can mean many different things. But for researchers and policymakers, it helps to have a way to compare countries by income using clear criteria.

One widely used approach is the World Bank’s income classification system, which places countries into four groups: low, lower-middle, upper-middle, and high-income countries. These groups are primarily intended for analytical and statistical purposes.1

These income groups are used across many international datasets, like the World Bank’s World Development Indicators — which include information on topics from access to energy and education to global trade — and are often cited in research and the media.

This article explains how countries are assigned to income groups, how the thresholds between groups are set and updated, some of the limitations of this classification, and how we use these groups at Our World in Data.

How are countries assigned to income groups?

How are the income thresholds determined?

What are the limitations of the World Bank’s method?

How we use income groups on Our World in Data

...read more at ourworldindata.org