Developed countries and underdeveloped countries

developed country is one that has high levels of quality of life and a large degree of industrial and socioeconomic development. It has a high per capita income and a high human development index.

An underdeveloped country is one that has a low level of quality of life compared to other countries. It depends on the agricultural sector, with little industrial development and presents socio-economic problems. In addition, it has a low per capita income , as well as a low human development index.

Countries with the lowest per capita income and human development index are also known as least developed countries.

Developed countryUnderdeveloped country
DefinitionIt is that country that has a high level of quality of life, per capita income, industrial and socioeconomic development.It is a country that has a relatively lower level of quality of life, per capita income and industrial development.
Characteristics
  • Developed industrial sector.
  • High levels of quality of life and income per capita.
  • High human development index.
  • Strong greeting system and a low infant mortality rate.
  • High life expectancy.
  • Population has access to education and a low degree of illiteracy in adults.
  • Political stability and social inequality is lower than in underdeveloped countries.
  • Dependence on the agricultural sector and little on the industrial development sector.
  • Low level of quality of life and income per capita.
  • Low human development index.
  • Health problems and infant mortality.
  • Life expectancy lower than that of developed countries.
  • Problems of access to education and high degree of illiteracy in adults.
  • It can have political instability and social inequality.
Gross national productEqual to or greater than USD 12,055.Equal to or less than USD 12,055.
Human development IndexEqual to greater than 0.80.Equal to less than 0.79
ExamplesNorway, United States, Switzerland, Iceland, Hong Kong, Australia, Holland, Portugal, Italy, Spain, Japan, Canada.Afghanistan, Mexico, Argentina, Sierra Leone, Chad, Costa Rica, Ghana, Ecuador, Turkey, Jamaica, Vietnam.

What is a developed country?

In general terms, a developed country is considered to be anyone with high levels of quality of life, with extensive industrial and socioeconomic development. They are countries that have a high per capita gross domestic product (GDP) and a high gross national product (GNP), as well as a high human development index.

The industrial sector, trade and economic advances are important economic factors in these countries. This allows for an active labor market. In addition, a large part of the population has access to higher education and there is a high rate of schooling.

Political and social stability are key elements within these countries. There are no internal armed conflicts, and they present a better distribution of wealth and greater social equality.

The health system is strong, and social security is available to the majority of the population. The infant mortality rate is minimal and life expectancy is longer than in other less developed countries.

Development indicators of underdeveloped countries

For the World Bank, countries with an annual per capita gross national product greater than USD 12,056 are considered high-income economies. In 2018, the total number of countries above this figure was 81.

Regarding the human development index, the United Nations Development Program considers that countries that reach a grade of 0.80, have a human development index classified as “very high”. In 2018, 58 countries were estimated to reach this range.

Characteristics of developed countries

  • Highly developed industrial and service sector.
  • High levels of quality of life.
  • Political stability.
  • Strong health and social security system.
  • High per capita gross domestic product and per capita gross national product.
  • High human development index.
  • High level of employment.
  • Low levels of socioeconomic inequality.
  • Low infant mortality rate and long life expectancy.
  • High levels of schooling.

What is an underdeveloped country?

An underdeveloped country, or a developing country, is known as one that has a per capita gross domestic product, a per capita gross national product and a low human development index in relation to other more developed countries.

The underdevelopment of these countries does not simply refer to their being in a pre-development stage; that a country is underdeveloped means that, at that particular moment, that country has a situation that does not allow it to achieve better quality of life and economic standards.

Main problems in underdeveloped countries

These countries present a gap in the distribution of wealth greater than that of the developed countries. There is a greater social division when it comes to access to resources.

Political instability, difficult access to employment, and weak industrial infrastructure cause problems of poverty, internal marginalization, and constant migration dynamics.

Infant mortality is higher than in developed countries, while life expectancy is shorter, since the health system is not as strong.

A large part of the adult population does not have higher education and there is a high level of school dropout in secondary education.

At an economic and commercial level, these countries are dependent on a poorly industrialized primary sector. Most of the manufactured products come from abroad.

Development indicators of underdeveloped countries

For the World Bank, a country is underdeveloped or developing if it has a per capita gross domestic product between USD 996 and USD 12,055. In total there are 103 countries that fall within this range.

Regarding the human development index, the United Nations Development Program considers that countries that achieve a grade between 0.50 and 0.79 have a “medium” or “high” human development index. In 2018, 92 countries were estimated to be within this range.

Characteristics of underdeveloped countries

  • Strong dependence on the agricultural sector and little industrial development.
  • Coexistence of a market and subsistence economy.
  • Low levels of quality of life.
  • Presence of a certain degree of political instability.
  • Low per capita gross domestic product and low gross national product.
  • Low human development index.
  • High birth rate and population density.

Less developed countries

The least developed countries are those that present structural problems of such magnitude that they impede their socioeconomic development and that are highly vulnerable to economic and environmental catastrophes . These countries are underdeveloped countries with a very low degree of development.

They have the per capita gross domestic product, per capita gross national product and the lowest human development index in the world.

The United Nations Organization classifies 47 countries as least developed. There are three factors to determine which countries are classified as least developed , according to the United Nations.

First, the per capita gross national product , which refers to the total production of goods and services by residents of a country. The UN considers a three-year average of per capita gross national product of $ 1,230 or less as the limit.

Second, the human resources index , which measures the human capital of a country based on various indicators related to the health and education of the population. The percentage of nutrition, enrollment in secondary studies, adult illiteracy and infant mortality are analyzed.

Third, the economic vulnerability index is used , which measures the structural vulnerability of a country to cope with economic or environmental disasters. Indicators of instability of agricultural production, instability of export of goods and services, population density and its geographical location, among others, are analyzed.

Together with these three factors, it is also considered that these countries have a maximum population limit of 75 million inhabitants.

Once a country is considered less developed, in order to pass this classification (graduate), that country must exceed the required level in two of these three factors. They can also cease to be considered this way if their per capita gross national product becomes twice the minimum established during that period.

Main problems in less developed countries

The financial structure of these countries is marginal. This means that there are not enough resources to be able to promote the local economy. There is a high dependence on the agricultural sector and on a subsistence economy.

Political instability, strong social tensions, and civil and regional clashes are common in these countries. In addition, the violation of human rights affects social mobilization, being common that there is a great division between groups and inequality.

The health system is very weak and the infant mortality rate is very high. Life expectancy is much shorter than in other more developed countries.

There is a lack of professional employment and access to primary and secondary education. This causes a cycle of extreme poverty.

Development indicators of the least developed countries

In the case of the World Bank classification, the per capita gross national product of the least developed countries is USD 995 or less. There are a total of 34 countries that are within this group.

Regarding the human development index, the United Nations Development Program considers that countries that achieve a grade between 0.20 and 0.50 have a “low” human development index. In 2018, 38 countries were estimated to be below this range.

Characteristics of the least developed countries

  • High infant mortality rate.
  • Political instability.
  • High dependence on the agricultural sector and a subsistence economy.
  • Lack of industrial infrastructure.
  • Lower levels of per capita gross national product and per capita gross domestic product in the world.
  • Inability to respond to environmental and economic disasters.
  • Serious problems in health and social security services.
  • High degree of socioeconomic inequality and violence.
  • Presence of local armed conflicts.

Per capita gross domestic product

Gross domestic product (GDP) refers to the total production of goods and services of a country, in monetary terms, during a year. It functions as an indicator of the state of an economy and considers what is produced by all productive entities within the limits of that country, regardless of the origin of the producing entity.

The GDP per capita is the result of dividing the GDP by the number of inhabitants, so it indicates the average income of a person. It is used to measure the quality of life of a given country and to measure its level of development.

The idea behind the GDP per capita is to consider the wealth that each person would have in a society, if the total wealth were distributed equitably. That is, its focus is on economic aspects related to the material well-being of citizens.

However, GDP per capita has among its limitations that it does not consider social inequality and the way in which wealth is distributed, if it is used as the main indicator of a country’s development.

Different international organizations carry out calculations of GDP per capita, which are based on dynamic data, so the results may vary. These organizations include the International Monetary Fund and the World Bank.

According to the IMF, advanced economies have a GDP per capita of approximately USD 48,000. The world average stands at USD 11,370.

Countries with the highest GDP per capita in 2018, according to the IMFPurchasing power in USDCountries with the lowest GDP per capita in 2018, according to the IMFPurchasing power in USD
Luxembourg113 950Afghanistan565,43
Switzerland83 580Sierra Leone495,86
Norway82 370Niger489,05
Macao81 590Mozambique481,25
Iceland75 700Democratic Republic of Congo478,32
Ireland75 190Madagascar474,78
Qatar67 820Central African Republic454,07
USA62 520Malawi349,13
Singapore61 230Burundi306,97
Denmark61 230Republic of South Sudan306,7

Human development Index

The Human Development Index (HDI) considers three basic dimensions related to the quality of life of the inhabitants of a country. These dimensions are having a long and healthy life, access to knowledge and maintaining a decent standard of living.

It was presented in 1990 by the United Nations Development Program and its objective is to expand the way of evaluating the development of a country, going beyond economic indicators. His interest is to better understand the opportunities that people have within a country (or those that that country offers its inhabitants), which would allow to improve human capacities in a direct way.

According to the United Nations Development Program, human development is achieved once conditions are created that promote social equality, human rights, security, environmental sustainability, and the right to civil and community participation.

Currently, the HDI also evaluates indicators related to lack of access to health, deprivation of schooling, unemployment, social exclusion and gender inequality. In addition to considering the level of environmental sustainability and the empowerment of women.

The HDI makes a calculation, according to data obtained by country, quantitatively showing the status of each of the dimensions. The measurements obtained are located on a scale of values ​​between 0 and 1.

Degree of Human DevelopmentHDI range
Very high0.80 the superior
Medium and High0,50-0,79
Low0,20-0,50

Dimensions of the human development index

A long and healthy life : this dimension uses different indicators such as life expectancy at birth, the average age of deaths in a country during a specific year, protection and social security, among others.

Knowledge : the indicators used are those of the adult literacy rate, and school enrollment in primary, secondary and higher education.

Decent standard of living : GDP per capita is used, using purchasing power parity in US dollars. In this way, the income and consumption of the population of a country are analyzed internally, and then this purchasing power is compared with other countries.

Countries with the highest human development index in 2017IDHCountries with the lowest development index in 2017IDH
Norway0,953Mozambique0,437
Switzerland0,944Liberia0,435
Australia0,939Mali0,427
Ireland0,938Burkina Faso0,423
Germany0,936Sierra Leone0,419
Iceland0,935Burundi0,417
Hong Kong0,933Chad0,404
Sweden0,933Republic of South Sudan0,388
Singapore0,932Central African Republic0,367
Holland0,931Niger0,354

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