The benefits of agricultural growth from land based development programmes in general, are unevenly distributed, tending to by-pass the marginal farmers and the landless. In theory, the indirect benefits from growth, operating through various expenditure-inequality. First, the income and employment generated by these linkages is mainly located in the rural areas. Secondly, the kinds of non-farm goods and services induced by agricultural growth area typically produced by small labour intensive enterprises. Household surveys in Bangladesh and elsewhere confirm that the landless and small farmers earn a major portion of their income from rural non-farm sector.

Given the importance of the linkages recognized in the literature, and the recent experience of moderate agricultural growth in Bangladesh this paper tries to assess the extent of such linkages in the country by analysing the pattern of consumption expenditure and the investment behaviour of different groups of rural households.