One Sunshine Doth Not a Harvest Make: An Examination of the Growth Momentum in Bangladesh

Abstract

This paper revisits the issues and trends observed in M.G. Quibria’s new book (Quibria 2019) and attempts to re-examine and interpret the recent episodes of economic growth in Bangladesh, both in its quantity and, to a lesser extent, in its quality. Indeed, current estimates appear to put Bangladesh as the growth leader of South Asia. Touching the 8 per cent threshold, the recent growth pace has led to a significant reduction in poverty, a modest increase in inequality, and major advances in pertinent social and human indicators. Under what scenarios may the recent growth momentum survive and continue to unleash further growth in the quest toward reaching the higher middle-income status in the next several decades? We evaluate the task at hand in the context of innovations both in the proximate sources of growth (namely, accumulation of human and physical capital and in total factor productivity TFP) and in institutional capital. The paper also briefly touches on concerns raised in the current growth and development literature of the looming challenges of future growth slowdown as experienced by countries failing to overcome the “middle-income trap” and falling prey to “premature de-industrialisation” at income levels much lower than the early growth leaders of the past century.