Beyond low and middle income countries: what if there were five clusters of developing countries?

Many have challenged the use of income per capita as the primary proxy for development. This paper continues this tradition with a twist. The paper challenges the continuing use of income per capita to classify developing countries as low income or middle income now that most of the world’s poor no longer live in low income countries (LICs) and ambiguity over the usefulness of the middle income country (MIC) classification given the diversity in the group of over 100 MICs. The authors use a cluster analysis to identify five types of developing countries using a set of indicators covering definitions of development based on the history of thinking about ‘development‘ over the last 50 years.