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WEO Data Forum > advanced economies & other emerging market and developing countries


 
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Dominika advanced economies & other emerging market and developing countries
Hello,
I´m student from Slovakia and I´m writing some schoolwork about the structure of world economics.
I want to ask what is a base of division the world into 2 major groups: advanced economies, and other emerging market and developing countries. I found an answer at your page (http://www.imf.org/external/pubs/ft/weo/2007/01/data/groups.htm#cc) but I´m not sure if I really understand it.
Could you please explain to me what is criteria of dividing the world into 2 major groups: advanced economies, and other emerging market and developing countries?
Thank you for your answer.
4/9/2008 9:28:11 AM
WEOModerator Re : advanced economies & emerging and developing economies
The main criteria used by the WEO to classify the world into advanced and emerging economies are:

(1) per capita income level,
(2) export diversification--so oil exporters that have high per capita GDP would not make the advanced classification because around 70% of its exports are oil, and
(3) degree of integration into the global financial system.

In the first criteria, we look at an average over a number of years given that volatility (due to say oil production) can have a marked year-to-year effect.

Note, however, that these are not the only factors considered in deciding the classification of countries. As it says in the WEO Statistical Appendix, "Rather than being based on strict criteria, economic or otherwise, this classification has evolved over time with the objective of facilitating analysis by providing a reasonably meaningful organization of data." Reclassification only happens when something marked changes or the case for change becomes overwhelming. For example, Malta joining the euro area was a significant change in circumstances that warranted a reclassification from an emerging and developing economy to an advanced economy.

Hope this helps,
Angela
4/9/2008 10:42:16 AM