The Outcast Nations are those nations which have chosen not to adhere to the standard government and citizenship established by the world council.  A large faction of these nations were split off during one of the World Wars although some were the product of unique revolutions.  The largest split of Outcast nations resulted after the Evolution War.  Entire populations were forced into exile, sent to a distant continent separated from the main continents by ocean.

Some Outcast Nations still exist within the main continents, but they are small, isolated, and do not make long alliances with others.  They are considered Bandits or Brigands by the rest of the world, since they do not adhere to basic principles.

In gameplay terms, players which want to defy nation rules can be exiled as an outcast.  e.g. player-killing despite multiple warnings and coding blocks to that extent.  Or reoccurring crimes, acceptance of demons, etc.

The largest Outcast Nation is ruled by rampant capitalism, their economy fueled only by personal desire and the constraints of the market.  Consequently, moral and ethical shortcuts can be made by ruthless business men.  This nation exists largely as a parable to make social commentary on the focused interests which can lead to things bad for the species in the long run.  Commentary upon our current trajectory, what in the system needs to be fixed.  This is not to say everything about our current system is bad, and these nations are really hyperbole.  But the standard government is a thematic choice of the world to explore an ideal economy which takes into account all beings and resources over the course of long time spans.

The biggest city in the large Outcast Nation is so heavily industrialized that there is no longer any nature within it.  It is a completely controlled and regulated environment, with machines filtering air before it goes into the city, all of the sewage and things being processed by chemical and physical means rather than sustainable biotic recycling systems.  It is a smog-ridden dungeon of a city, stories tall with artificial light, incredibly complicated technology, but most people are sickly, unhappy, overworked or at the mercy of crappy labour conditions, poverty and crime abounds, and some people are sustained only by mechanical implants.

Image Attribution

http://keun-chul.deviantart.com/art/Abandoned-house-183494842 - CC3 BY NC ND - brigand/pirate chief house next to a wall