Addressing Regional Inequality Issues in Bangladesh Public Expenditure

Abstract

The public expenditure allocation in Bangladesh has played a substantial role in improvements of physical infrastructure, health, education, community development, etc. during the recent decades. There have been allegations that inequality in the distribution of political power has often led to some extent to a disproportionate public spending, which in turn may hinder prospects of poverty reduction. The current study aims to examine the research question of whether regional inequality issues are properly addressed within the framework of the public expenditure allocation in Bangladesh during the recent years and if not, whether this has been influenced by some other considerations, which are mainly political by nature. We analyze a panel data set where the dependent variable is the (greater district) per capita ADP allocation within a sector and the independent variables are some explanatory variables, and a variable of interest measuring the proportion of the total number of constituencies within the greater district that belongs to the political party in power. In summary, the study provides evidence of some in-built regional inequality features within the public expenditure allocation in Bangladesh in association with the political favoritism issues involved in a supposedly parliamentary democratic system.Public Expenditure, Regional Inequality, Political Influence in Regional Distribution of Public Expenditure, Panel Data