Per Capita Income is the main criterion used by the World Bank in classifying different countries. The limitation of thiscriterion are: → It doesn't show the distribution of income. → It also ignoresother factors such as infant mortality rate, literacy level, healthcare, etc....

World Bank's criterion for classifying countries

The World Bank classifies countries based on their income level. It uses Gross National Income (GNI) per capita as the main criterion for classification. According to the World Bank, low-income economies are those with a GNI per capita of $1,025 or less, while high-income economies are those with a GNI per capita of $12,746 or more. Middle-income economies are those with a GNI per capita between these two thresholds.

Limitations of World Bank's criterion

The World Bank's criterion has several limitations. Firstly, it only considers income level and does not take into account other important factors such as human development, education, and health. Secondly, it does not consider the distribution of income within a country. A country with a high average income may still have a large population living in poverty. Finally, the criterion does not account for differences in the cost of living between countries.

Differences between World Bank's criterion and UNDP's criterion

The United Nations Development Programme (UNDP) uses the Human Development Index (HDI) as the main criterion for classifying countries. The HDI takes into account three factors: life expectancy, education, and income. Unlike the World Bank's criterion, the HDI considers factors other than income level and provides a more comprehensive picture of a country's development.

Another difference between the two criteria is that the HDI measures achievements in human development rather than just income level. The HDI takes into account the quality of life and well-being of a country's citizens, which is an important aspect of development that is not captured by the World Bank's criterion.

In conclusion, while the World Bank's criterion for classifying countries based on income level has its limitations, it is still a useful tool for understanding a country's economic development. However, it is important to also consider other factors such as human development when assessing a country's overall level of development.