I've been seeing first tier, second tier and third tier cities in Chinese web novel for over a decade. Are these real terms people use in China? Not asking if some cities are better than others. Just if they are referred to as such.
No, they are simply products of a third tier imagination. For a more serious answer, yes, such classification exists, at least in my country as a form of (mostly unofficial) categorization based on scale of population, economy and infrastructure development.
Definitely. In countries like India and China, there just are so many people that the area of a US town could host a population of a major US city. So different tiers of cities exist. This classification is important for administration and planning.
so there wiki article about it huh... yep as this cat suspect fame also important cuz it is unofficial stuff~