Question

what is the main Criterion used by World Bank in classifying different countries what are limitations of these countries

Answer 1

The World Development Report, 2012, brought out by the World Bank has given the following criterion in classifying countries-
Rich or High income countries- Countries with the per capita income of US $1216 per annum and above in 2012, are called rich countries.
Poor or Low income countries- The countries with the per capita income of US $1035 or less, are called low income countries.
India comes in the category of low middle income countries because its per capita income in 2012 was just US $1530 per annum. The rich countries, excluding countries of Middle east and other small countries, are generally called the developed countries.
Limitations-
1. It covers only the economic aspect ignoring peace, health, environment, education, longevity ,etc.
2.This method does not give information regarding the distribution of income.
Hope it helps you !

Answer 2

Per Capita Income is the main criterion used by the World Bank in classifying different countries. The limitation of this criterion are:

Per capita income is useful for comparison but it doesn't show the distribution of income.

It also ignores other factors such as infant mortality rate, literacy level, healthcare, etc.

Per capita income does not give the true picture as there is a huge population which does not earn at all like children and the senior citizens but they are also included while calculating per capita income. National income rises but its distribution make the rich richer and the poor poorer.