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The Bangladesh Development Studies
Volume XXII, March 1994, Number 1

Demand Elasticities in Rural Bangladesh: An Application of the AIDS Model
By Akhter U. Ahmed and Yawar Shams

This study estimates a complete demand system for rural Bangladesh, applying the Almost Ideal Demand System (AIDS) model. The estimates of demand parameters are based on primary data from the rural household survey conducted by IFPRI in 1991/92. Even though the sample may over-represent the rural poor, the estimates of income elasticity of demand suggest that rural households in general are highly responsive to changes in income in adjusting their consumption patterns. Demands for commodities are also quite responsive to changes in their own prices, with the exception of salt. The estimates of cross-price elasticities indicate that substitution effects are strong, and therefore have important implications for price policies. Disaggregated by income groups, the estimates of demand parameters of rice and wheat suggest that low-income households are more price ad income responsive than high-income households are more price and income responsive than high-income households. Differences in elasticities in absolute values between the two groups are quite striking. The estimates conform with the findings of other studies that wheat is an inferior commodity in rural Bangladesh. This attribute makes wheat a self-targeting commodity for targeted food intervention programmes. The study contends that government price intervention programmes. The study contends that government price interventions may lead to serious price repercussions in the economy. In contrast, income generating programmes and policies foster higher levels of consumption for all normal Commodities, and thus, a steady growth in production by enhancing effective demand.

Programme Impact on Current Contraception in Bangladesh
By Muhammad Abdul Latif

This paper analyses the impact of three credit programmes – the Bangladesh Rural Advancement Committee (BRAC), the Bangladesh Rural Development Board’s Rural Development-12 (BRDB RD-12), and the Grameen Bank (GB), on current rate of contraception. These programmes are targeted to alleviate poverty by providing group-based credit to the rural poor in creating self employment opportunities. With small credits, these programmes combine family planning activities in terms of consciousness raising, awareness building and motivation. Sample survey data are used to analyse the problem of impact evaluation. The analyses show that the BRAC and the GB programmes have significantly positive impact on the current rate of contraception, while the BRDB RD-12 programme dues not have any such impact. It is also found that education, both of female and male separately, and child survivorship have independently position impact on current contraception. The present findings bear important implications for programmes aimed at reducing fertility.

The Dynamic of Macroeconomic Activity and Granger Temporal Causality:  New Evidence from Bangladesh
By Abul M.M. Masih and Rumi Masih

The primary purpose of this paper is to discern the dynamic causal chain [in the Granger (temporal) sense rather than in the structural sensel] among real output, money, interest rate, inflation and the exchange rate in the context of a small Asian developing economy, such as Bangladesh. The methodology employed uses various unit root tests and Johansen’s co-integration test followed by vector error-correction modelling, variance decompositions, and impulse response functions in order to capture both the within-sample and out-of-sample Granger causal chain among macroeconomic activity. Given the relatively inward-oriented growth strategy of this small developing economy, where the real output was vulnerable to the vicissitudes of the dominant agricultural sector prone to weather, floods and cyclones as well as the external sector including volatile foreign assistance and labour remittances from aboard, our results quite in line with our expectations, ten to suggest that in the Granger-causality sense, output was relatively the leading variable being the most exogenous of all, and all other variables including money supply, prices, exchange rate, and interest rate had to bear the brunt of adjustment endogenously in different proportions in order to accommodate that real shock. The Granger-causal chain implied by our evidence that real output more often predominantly leads (rather than lags) money supply and the other three endogenous variables, is consistent more with the recent Real Business Cycle (RBC) theory than with the other two major macroeconomic paradigms such as, the Keynesian and the Monetarist. This finding has strong policy implications for any accommodative and/or excessive monetary expansion since it is likely to be dissipated in terms of relatively higher normal variables, such as, prices or exchange rates or interest rates rather than real output for a small developing economy like Bangladesh, given a relatively unstable overall macroeconomic environment.

The Bangladesh Development Studies
Volume XXII, June-Sept. 1994, Numbers 2&3

Non-market Work and National Income: The Case of Bangladesh
By Shamim Hamid

The main objective of this paper is to develop a new system of national income accounting that better reflects women’s contribution to the national income. New methodologies are developed to decompose conventional GDP. The methods are then applied to the case of Bangladesh using nationally representative data on time allocation of men and women. The paper concludes that a more realistic estimation of GDP will be achieved only if women’s and men’s non-market work is accounted for-this methodology yields a GDP figure that is 29 per cent higher than conventional estimates, and it shows that women conventional estimates, and it shows that women contribute 41 per cent to total GDP.

Role of Targeted Credit Programmes in Promoting Employment and  Productivity of the Poor in Bangladesh
By Rushidan Islam Rahman and Shahidur R. Khandker

The success of credit programmes for the landless poor lies in the alleviation of poverty. The process of alleviation of poverty can be more clearly understood through an analysis of the employment that is generated with the credit and the return from activities where such employment is generated. The paper shows that the three credit programmes, (BRAC, BRDB and Grameen Bank) have been successful in expanding the opportunities of self employment. Labour force participation rates among women have increased. Participation rates and employment per worker are higher among programme participants than among target group population in the control area. The paper also indicates that, the average return to self-employment is higher than the wage rate. Thus self-employment provides a good prospect of alleviating poverty through generation of more employment which pays-off at a rate higher than the wage rate. The average returns are higher in non-agriculture compare to those in livestock and agriculture (crop production activities).
The marginal productivity estimates of different types of labour shows that the marginal return to non-agriculture is the highest followed by agriculture and livestock production. However, the marginal productivity of each category of family labour, male and female, varies substantially by type of self-employment. In agriculture, the marginal productivity of female (family) labour is positive and significant, and that of male (family) labour is zero. In contrast, the marginal productivity of male (family) labour in non-agriculture is positive and significant and that of female (family) labour is zero. Further research is needed to explain why the marginal productivity of labour is zero in some activities.

The Role of Women’s Employment Programmes in Influencing  Fertility Regulation in Rural Bangladesh
By Simeen Mahmud

In Bangladesh the reduction of population growth through declines in marital fertility levels has long been viewed as a desirable, if not essential, development objective that is amenable to policy interventions. In particular, the provision of income earning opportunities to women was believed to have an important role in influencing individual reproductive behaviour leading to the increased and sustained use of modern contraceptives. This paper addresses the question of whether participation in employment programmes allows women to alter their fertility regulating behaviour. Using a quasi-experimental design comprising of programme participating women and a comparison group of non-participants, it seeks to identify factors related to women’s work context that are important in determining contraceptive use. The paper finds that changes in women’s work context in terms of higher returns to labour, increased access to extra-family support and greater mobility outside the home are most strongly associated with the increased use of modern contraceptives among rural women residing in intervention areas. Besides, the differential impact of the institutional approaches to input delivery on fertility regulation was also indicated.

Gender Inequality within Households : The Impact of a Women’s Development  Programme in 36 Bangladeshi Villages
By Sajeda Amin and Anne R. Pebley

This paper measures the impact of programme participation on a range of women’s status indicators such as control over household resources, mobility and autonomy and attitudes and aspirations. Five hundred female respondents were interviewed in 36 rural villages in two thanas of Manikganj district in 1989. Respondents were selected according to an experimental design to control for presence of NGO programme in the village, membership in BRAC Programmes and duration of membership. Qualitative information was gathered in focus group discussions and semi-structured interviews. Using multiple logistic regression to estimate the impact of group membership and programme effect, the study estimated programme impact on measures of gender inequality. It found that while programmes, after about two years, had a statistically significant impact on gender inequality within the household in terms of women’s participation in decision-making and control over resources, women’s attitudes and aspirations regarding marriage and education for their daughters is slower to change.

Empowerment of Women: Listening to the Voices of Women
By Ruchira T. Naved

This paper focuses on how the women beneficiaries of empowerment programmes perceive interventions and what according to them are the outcomes of such interventions. Using in-depth interviews and focus group discussions this study documents women’s perceptions about the changes brought about by credit and concretization programmes.
Women hold that many important and positive changes took place at individual, familial and societal levels. They feel that they have gained greater access and control over resources. Further, the relationship of women with others have improved. To a lesser extent, they have become able to change the external environment.
Women are valued more in the family for their contribution in family’s income. Verbal and physical abuse and violence against women have been reduced. Women’s mobility has increased tremendously. Women have developed linkages with various service providing institutions and social organizations. Women have learned to defend their own interests through group actions. All of these have ultimately translated into better living conditions for children. Of utmost importance is the fact that women themselves highly value the changes that took place in their conditions and positions.

Dynamics of Wage Employment : A Case of Employment in the Garment Industry
By Pratima Paul-Majumder and Salma Chaudhuri Zohir

This paper has analysed socio-economic transformation brought about in the lives of women who migrated to the cities from rural areas to take up work in the garment industry which has opened before them an unprecedented opportunities for gainful employment. In terms of socio-economic change in women’s living, the garment workers appear to have experined the most change. However, the socio-economic transformation brought about by the wage employment in the garment industry is narrowed down to a large extent by some negative implication such as exploitation in terms of low wage, irregular wage payment, job insecurity, gender discrimination in earnings etc. A regression analysis of the determinants of earning shows that the variable distinguishing the earnings of male and female is positive and significant showing that female workers earn significantly less than their male counterparts having the same education, length of service, which in turn, is found to be highly correlated with level of earning, and occupational status of the workers. Social gains attained through wage employment are also substantially curtailed by the social  insecurity arising from incongenial work environment, absence of safe and secured housing facilities and lack of transport facilities. Grave concern has been expressed over the negative impact of garment factory jobs on female workers’ health. Finally, the paper suggested that implementation of labour laws and women’s education would help women to overcome many of the disadvantages they face in the labour market.

The Bangladesh Development Studies
Volume XXII, December 1994, Number 4

The Effect of Credit Liberalization on Farm Households in Bangladesh
By Anwar Ahmed and John Kennedy

The aim of this paper is to analyse the impact of deregulation of rural credit on Bangladeshi farm households by size of holding. Parametric linear programming techniques are used to develop “multi-activity” household models of farms of different sizes. Farmers are assumed to be risk averse. An important model result is that the provision of credit for production, consumption and non-farm activities under a deregulated regime would significantly improve the viability of small-farm households.

Bangladesh and the Uruguay Round: A General Equilibrium Welfare Analysis
By Helal Ahammad and Peter G. Warr

A general equilibrium approach is used in this paper to analyse the effects that the Uruguay Round of the GATT may have on economic welfare in Bangladesh. The analysis is carried out in the ‘second-best’ situation wherein some policy distortions within Bangladesh still prevail, and a methodology is innovated to decompose the direct and indirect changes in economic welfare within Bangladesh. It is concluded that the round is welfare-reducing for Bangladesh but that if Bangladesh were to reduce its own protection at the developing country average of 24 per cent, the welfare-reducing consequences of the Round would be approximately negated.

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