Poverty Trends and Growth Performance: Some Issues in Bangladesh

With a low level of per capita income, nearly one of every two persons in Bangladesh is poor, and one of three lives below the income poverty line of $ 1 a day.1 If those who are deprived of adequate clothing or shelter or other basic needs are counted, the number will be considerably higher. Similarly, if the people who live ‘above’ the poverty line but are vulnerable to risks, crisis and socioecononomic shocks and are in constant danger of income erosion below the poverty threshold are considered, the number will be still larger. The poor in Bangladesh differ in economic, social, physical and other characteristics which reflect various deprivations. Such multidimensionality of the poor’s interlocking deprivations suggests that a strategy of increasing income alone may not be adequate for reducing poverty.2 With multi-dimensional characteristics, poverty requires a multi-strategy solution in Bangladesh. The implications of attacking poverty within a broad framework highlight the interactions that exist between income and non-income deprivations. The reduction in income-poverty helps in alleviating non-income poverty through enhanced capacity of the poor to gain access to basic needs.

The Impact of the HYV Technology on the Variability of Rice Production and Yield: Some Evidence from Bangladesh

In recent years, the impact of the high-yielding varieties (HYVs) of cereals on the stability of cereals production has received increasing attention along with the growth potential of the technology. A number of studies, especially on Indian agriculture, have emphasized the destabilizing impact of the technology on foodgrains production. In contrast to such findings, the present analysis of rice production and yield in Bangladesh suggests a lower variability during the post-adoption period. Such conclusions are also supported by seasonal and regional data, although HYVs themselves are seen to be more variable than their local counterparts. An examination of the trends in variability during periods separated by the new technology provides an evidence of areversal of trends. It is argued that, with the introduction of HYVs, complementary technological innovations and land/water resources development have taken place, which have enabled the farmers to reduce gross dependence on nature and played key roles in reductions in variability in rice production and yield in Bangladesh.

Trade and Linkages Using Input-Output Approach: An Empirical Investigation of Bangladesh

Employing a variant of the open-static Leontief model and a 53-sector input-output table, the paper identifies a variant of the key sectors in the Bangladesh economy in terms of trade linkages. The concepts of gross and net linkages are introduced and the analysis is extended to both current (flow) and capital (stock) accounts. On the gross linkage criterion, only a handful of sectors emerge as key sectors with three or more linkages. These sectors are from within the manufacturing and services categories. This is also the case with sectors having two strong linkages. Agricultural sectors do not feature at all. A transition from gross to net linkages changes the rankings quite significantly. Most agricultural sectors show two strong linkages in the flow account. The findings suggest that Bangladeshi export sector, is typically undiversified in that it relies heavily on agriculture and related industries, with jute and jute textiles accounting for over 70 percent of net export earnings. Not surprisingly, most sectors in the industrial complex are net importers and the domestic production of industrial goods is highly import-intensive.

Navigating the global financial storm: challenges for Bangladesh

The Bangladesh economy is largely shielded from the most immediate and direct effects of the financial crisis. However, Bangladesh's exposure to real economy effects of the financial crisis is likely to be greater through exports, remittances, and foreign capital inflow channels. The major sources are the projected slowdown in growth in the advanced economies which may lead to decline in exports (especially of readymade garments) since nearly 87 percent of Bangladesh's exports are destined to markets in advanced countries, remittances may ease as the source economies face lower growth and challenging times, aid inflow may reduce, and Bangladesh's macroeconomic stability and growth prospects may suffer. A liberalized, market based, and effectively supervised and regulated financial sector capable of generating quality information is necessary in order to promote and sustain rapid growth in Bangladesh. The important agenda for Bangladesh is to convert the current global crisis into an opportunity in order to move forward

Measuring inflationary pressure in Bangladesh: the P-star approach

The paper estimates the P* model for the Bangladesh economy and tests its forecasting ability through generating recursive forecasts. The model puts together long run determinants of price level based on the classical quantity theory of money and short term changes in current inflation. The empirical results show that the model performs relatively well and contains additional information regarding future rates of inflation. The price and output gap models fare consistently better than the velocity gap model which brings out the importance of non‐monetary factors in explaining inflation dynamics in Bangladesh. The out of sample forecasts show that the price gap model performs better followed by the output gap model and the velocity gap model. With financial sector liberalization and reforms, it is likely that the scope for the P* model to play a more proactive role would be ramified in Bangladesh

The Impact of the HYV Technology on the Variability of Rice Production and Yield: Some Evidence from Bangladesh

In recent years, the impact of the high-yielding varieties (HYVs) of cereals on the stability of cereals production has received increasing attention along with the growth potential of the technology. A number of studies, especially on Indian agriculture, have emphasized the destabilizing impact of the technology on foodgrains production. In contrast to such fmdings, the present analysis of rice production and yield in Bangladesh suggests a lower variability during the postadoption period. Such conclusions are also supported by seasonal and regional data, although HYVs themselves are seen to be more variable than their local counterparts. An examination of the trends in variability during periods separated by the new technology provides an evidence of a reversal of trends. It is argued that, with the introduction of HYVs, complementary technological irmovations and land/water resources development have taken place, which have enabled the farmers to reduce gross dependence on nature and played key roles in reductions in variability in rice production and yield in Bangladesh

SOME TECHNOLOGICAL ASPECTS OF FOODGRAINS PRODUCTION IN NORTH-WEST BANGLADESH

The paper analyzes certain characteristics of foodgrains production technology in North-West Bangladesh. A comparison of regional with national data reveals that the region lags behind the national average in the use of yield raising inputs. The growth of irrigation in the region is also seen to be biased toward high cost technology. Despite these unfavourable conditions, the performance of food-grains production sector is encouraging in the area. The rich potential of the sector in the region is, however, constrained by various socio-cultural and technological factors including non availability of irrigation water during dry season. It is argued that the realisation of the potentials requires appropriate policy measures encompassing several dimensions

THE DETERMINANTS OF ACREAGE UNDER JUTE IN BANGLADESH, INDIA AND THAILAND: 1950-1975

In this study, a general model of annual jute acreage is developed, based on the assumptions of lagged adjustment of actual to desired area, and "naive" price expectations. A number of different formulations see examined empirically in order to arrive at the particular general model. The results of fitting this model to data from the three major producing countries-Bangladesh India, and Thailand indicate that jute garage is indeed quite responsive to changing economic factors. The elastic nature of jute acreage to prices, both of jute and of rice or other alternative crops, is an important aspect of the world jute market. The analysis suggests that the principal determinant of area under jute in these countries is the jute farmer's expectations of the relative price of jute compared to the alternative crops, which is largely determined by is preceding year's prices

Employment Promoting Growth in Bangladesh: Monetary and Financial Sector Issues

Although economic growth has improved in recent years in Bangladesh, the better economic performance has not translated into satisfactory poverty reduction. The type of growth that matters Bangladesh is the one that creates employment opportunities especially for the poor. In Bangladesh, monetary policy can create better employment opportunities with a well functioning financial sector having capability to ensure adequate resource flows to socially productive uses. On the contrary, such a monetary regime may contribute to high real interest rates impeding the realization of stipulated growth and poverty reduction. For success in reducing poverty, complementary policies to increase the economic mobility of the poor and raise their average returns to labor are also crucial.[PAU 0904]Bangladesh; economic growth; employment; monetary policy; financial sector, inflation,interest rates,trade and exchange rates, labour market, employment structure