What Is a First World (aka Developed or Industrialized) Country?

First World

Laura Porter / Investopedia

What Is the First World?

“First world,” a term developed during the Cold War in the 1950s, originally referred to a country that was aligned with the United States and other Western nations in opposition to what was then the Soviet Union and its allies.

Since the collapse of the Soviet Union in 1991, the term’s meaning has largely evolved. Currently, it describes a developed and industrialized country characterized by political and economic stability, democracy, the rule of law, a capitalist economy, and a high standard of living.

Key Takeaways

  • The term “first world” originally applied to countries that were aligned with the United States and other Western nations in opposition to the former Soviet Union.
  • First world countries are often characterized by prosperity, democracy, and stability—both political and economic.
  • A high literacy rate, free enterprise, and the rule of law are other common characteristics of first world countries.
  • Some critics argue that the concept of dividing nations into three worlds represents an antiquated perspective.
  • Many first world countries have certain demographics that are in extreme poverty, which is more representative of developing countries; other countries with third world status are quite prosperous.

Understanding the First World

Examples of first world countries include the United States, Canada, Australia, New Zealand, and Japan. Several Western European nations qualify as well, especially Great Britain, France, Germany, Switzerland, and the Scandinavian countries.

The ways that first world countries are defined can vary. For example, a first world nation might be described as aligned or amicable with Western countries or those in the Northern Hemisphere, highly industrialized, possessing a low poverty rate, and/or high accessibility to modern resources and infrastructure.

Various metrics have been used to define first world nations, including gross domestic product (GDP), gross national product (GNP), mortality rates, and literacy rates. The Human Development Index is also an indicator of which countries might be categorized as having first world status.

Economically speaking, first world countries tend to have stable currencies and robust financial markets, making them attractive to investors from all around the world. While they may not be purely capitalist, first world nations’ economies tend to be characterized by free markets, private enterprise, and private ownership of property.

Under the original Cold War alliance designations, the first world consisted of the U.S., Western Europe, and their allies. The second world was the so-called Communist Bloc: the Soviet Union, China, Cuba, etc. The remaining nations, which didn’t align with either group, were assigned to the third world—most of Africa, Asia, the Middle East, and Latin America. However, this definition includes many countries that are economically stable, which does not fit the contemporary definition of a third world country.

Criticism of the First World Designation

Controversy exists around the use of the term “first world” to describe democratic countries in comparison with developing nations and those with political regimes that do not align with Western nations’. There is a tendency toward using the phrase as a way to rank some nations above others in terms of geopolitical significance. Such references can lead to divisive tension in international relations, especially as developing nations seek to negotiate with so-called first world countries or appeal to the international community for support of their causes.

It is not uncommon for first world nations to press for international policies, especially economic ones, that will favor their industries and trade to protect or enhance their wealth and stability. This can include efforts to influence decisions made in such forums as the United Nations or the World Trade Organization (WTO).

Designation as a first world nation does not necessarily mean a country has local access to certain luxuries or resources that are in demand. For example, oil production is a staple industry in many countries that historically have not been regarded as first world nations. Brazil, for instance, contributes substantial amounts of oil to the overall world supply, along with other forms of production; however, the country is recognized as a developing, industrialized state rather than as a first world nation.

In contemporary parlance, “developed” or “industrialized” nation is considered a preferable term to “first world country.”

An Antiquated Model

There is an argument to be made that the model of dividing nations into first, second, or third worlds represents an archaic and antiquated perspective.

Since the end of the Cold War, the United States has become one of the world’s superpowers, and an increasing number of countries have embraced or are in the process of adopting American-style democracy and capitalism. These countries are neither abysmally poor nor exceedingly rich; rule of law and democracy are their defining features. As such, it would be counterintuitive to describe them with the pejorative term of “third world.” Examples of these types of countries include Brazil and India.

The original definition of “first world” as a country aligned with the United States has also led to some odd classifications of quite prosperous and advanced nations. Oil-rich Saudi Arabia, which has a higher per capita income than first world country Turkey, is still often technically slotted as a second or third world nation, for example—or at least, denied the first world designation.

Then there is the increasing problem of wealth inequality. The high per capita income associated with the first world often belies an extremely uneven distribution of wealth in these nations. Several first world countries have poverty-stricken regions where conditions are comparable to those in developing countries. For example, residents of Appalachia and other rural areas of the United States often lack resources and essentials for a minimum standard of living. Even certain sections of large cities, such as the South Side of Chicago or northern Milwaukee’s 53206 neighborhood, feature impoverished conditions.

What is the first world?

While highly subjective, “first world” is a term that consists of countries that may have the following characteristics: stable democracies, high standards of living, capitalist economies, and economic stability. Other measures that may be used to indicate first world countries include gross domestic product (GDP) or literacy rates. Broadly speaking, countries that may be considered first world include the United States, Japan, Canada, and Australia, among others.

What defines a first world country?

There is no universal way to define a first world country. They are often characterized as industrialized and democratic nations. These features are typically accompanied by stable currencies, sound financial markets, and modern infrastructure. Due to these factors, first world countries often attract foreign direct investment and capital inflows.

Why is the term ‘first world’ contentious?

“First world” is a problematic term because it is outdated. First coined during the Cold War, it referred to countries that were allies of the United States—mostly other westernized countries, as opposed to countries that aligned with the former Soviet Union. Because the economic indicators used to define the first world vary by their perspective, the first world can represent an opaque concept of a country’s economic stature. For instance, despite Saudi Arabia having per capita income that is nearly equal to Portugal’s, it is often considered a second world nation.

The Bottom Line

First world nations are those described as highly-developed industrialized, technologically-advanced, educated, and wealthy. In contrast to developing (second world) and less-developed (third world) countries, the first world is seen to enjoy many benefits such as a relatively high quality of life and prosperity. The phrase "first-world country" was popularized in the 1950s and 1960s during the Cold War to describe developed countries considered to have the power to influence international politics through their economic, technological, and military strength. The term was not explicitly political; it described a grouping based on aggregate wealth or perceived power rather than an ideological outlook. First world countries included Australia, Canada, France, Germany, Italy, Japan, New Zealand, Norway, the United Kingdom, and the United States, among others. Today, the term has fallen somewhat out of favor, as critics argue it is an outmoded model for understanding national development.

Article Sources
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  1. U.S. Department of State, Office of the Historian. “The Collapse of the Soviet Union.”

  2. The World Bank, World Bank Open Data. “GDP Per Capita (Current US$)—High Income, Saudi Arabia.”

  3. The World Bank, World Bank Open Data. “GDP Per Capita (Current US$)—Turkey (Turkiye).”

  4. University of Wisconsin-Milwaukee, Center for Economic Development. “Milwaukee 53206: The Anatomy of Concentrated Disadvantage in an Inner City Neighborhood 2000–2017.”

  5. The World Bank, World Bank Open Data. “GDP Per Capita (Current US$)—Portugal.”

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