The macroscopic nonlinear pyroelectric polarization of wurtzite AlxGa1-xN, InxGa1-xN and Al(x)ln(1-x)N ternary compounds (large spontaneous polarization and piezoelectric coupling) dramatically affects the optical and electrical properties of multilayered Al(In)GaN/GaN hetero-, nanostructures and devices, due to the huge built-in electrostatic fields and bound interface charges caused by gradients in polarization at surfaces and heterointerfaces. Models of polarization-induced effects in GaN-based devices so far have assumed that polarization in ternary nitride alloys can be calculated by a linear interpolation between the limiting values of the binary compounds. We present theoretical and experimental evidence that the macroscopic polarization in nitride alloys is a nonlinear function of strain and composition. We have applied these results to interpret experimental data obtained in a number of InGaN/GaN quantum wells (QWs) as well as AlInN/GaN and AlGaN/GaN transistor structures. We find that the discrepancies between experiment and ab initio theory present so far are almost completely eliminated for the AlGaN/GaN-based heterostructures when the nonlinearity of polarization is accounted for. The realization of undoped lattice-matched AlInN/GaN heterostructures further allows us to prove the existence of a gradient in spontaneous polarization by the experimental observation of two-dimensional electron gases (2DEGs). The confinement of 2DEGs in InGaN/GaN QWs in combination with the measured Stark shift of excitonic recombination is used to determine the polarization-induced electric fields in nanostructures. To facilitate inclusion of the predicted nonlinear polarization in future simulations, we give an explicit prescription to calculate polarization-induced electric fields and bound interface charges for arbitrary composition in each of the tertiary III-N alloys. In addition, the theoretical and experimental results presented here allow a detailed comparison of the predicted electric fields and bound interface charges with the measured Stark shift and the sheet carrier concentration of polarization-induced 2DEGs. This comparison provides an insight into the reliability of the calculated nonlinear piezoelectric and spontaneous polarization of group III nitride ternary alloys.