Suchergebnisse

This paper investigates a number of inter-related issues pertaining to the recent poverty scenario of Bangladesh – viz., (a) making sense of a marked slowdown in the pace of poverty reduction after 2010, (b) identifying the structural determinants of poverty reduction, and (c) examining regional divergence in the rate of poverty reduction. The analysis identifies falling real wages as the main proximate reason for both slowdown in poverty reduction and rise in income inequality in recent years. The underlying reason, however, is a massive upsurge in rural-to-urban migration which has exerted a downward pressure on real wages in the urban labour market, with repercussion on the rural labour market as well. The main determinants of poverty reduction in the recent years are found to lie in a couple of structural changes – (a) occupational shift, from relatively low-remuneration activities to relatively high-remuneration activities, induced by economic growth and (b) the spread of education, which enables workers to move into relatively high-occupation activities and to earn higher income within the same occupation. Divergent performance in terms of the same two structural factors – namely, occupational shift and the spread of education – are also found to explain a large part of the regional divide in the success in poverty reduction, although additional factors – related to geography and demography – may also be at work.

There appears to exist a deep-seated scepticism about microcredit in popular perception in Bangladesh. One manifestation of this scepticism is the oft-repeated allegation, based mainly on hearsay or anecdotes, that microcredit is leading hordes of borrowers into a "debt trap." The present paper makes the first systematic attempt to empirically investigate the existence, nature and magnitude of debt trap among microcredit borrowers in Bangladesh. The investigation relies on a large-scale nationally representative rural household survey, covering the period 2007-2013. The paper begins by examining the prevalence of two inter-related practices – namely, "overlapping borrowing" and "borrowing to repay," which are often taken as indicators of debt trap in popular discussion of the subject. The paper argues that although these practices could sometimes lead to a debt trap, neither of them necessarily does so, so that the magnitude of debt traps could not be deduced from the magnitude of these practices. After defining the criteria for identifying a debt trap, the paper finds that debt traps can be said to characterise at most 4.5 per cent of microcredit borrowers who engage in "borrowing to repay" and only about 1.4 per cent of all microcredit borrowers. Furthermore, even in these few cases, microcredit cannot generally be held responsible for their plight. Debt traps occur when extremely vulnerable households are faced with overwhelming shocks; and the role of microcredit here is to help people to cope better with such shocks rather than to cause them.

It is always a pleasure for me to participate in these annual
meetings. The knowledge and the talent displayed are immense. The
quality of discussion is high. I had never thought however that I would
have the honor of delivering the Aalama Iqbal lecture. To prepare for
this lecture I read extensively from Iqbal's poetry. Of course I read in
translation, but even so I was overwhelmed by the beauty of the ideas
and the expression. My search for an apt couplet or set of lines for
this paper was in vain. Iqbal was speaking to his people and although he
was expansive in his view of society, it is still not meant for me to
carry the word of Iqbal to you. Nevertheless I do display at the
beginning of this paper three lines from Iqbal. He is clear on the
importance of doing for oneself and for ones country. At least in the
modern world ones efforts are so much more productive if government
provides a favourable environment for individual effort. And he would
embrace the brotherhood of mankind, leaving some potential for us to
help each other. He was very clear that learning from the West was
desirable, and he was very selective about that—science and technology
in particular. My paper is about what government must do, and
specifically the government of Pakistan must do, to create an
environment in which not just a few gather dew but in which all people
gather dew. As soon as ones concern encompasses the bulk of the
population food security comes to the fore. My paper can be seen as
addressing how all rural people can gather the dew. It has a prominent
place for science and technology.