Development Economics in Bangladesh Grade 12 Economics Case Study

1. Overview of Bangladesh

Bangladesh was the original development “basket case”, the demeaning term used in Henry Kissinger’s state department for countries that would always depend on aid. Its people are crammed onto a flood plain swept by cyclones and without big mineral and other natural resources. It suffered famines in 1943 and 1974 and military coups in 1975, 1982 and 2007. When it split from Pakistan in 1971 many observers doubted that it could survive as an independent state.

Bangladesh is now an exporter of rice and grows 3 times as much than 40 years ago with the same land area.

2. Comparing Development

Textiles manufacturing now make up 90% of exports and are the biggest contributor to GDP.

3. Domestic factors leading to Economic Development

Increased access to Education

In Bangladesh increased education is representing in more than 90% of girls enrolled in primary school in 2005, slightly more than boys. That was twice the female enrolment rate in 2000. Increased access to education tends to lead to two important impacts.

  1. Improving the role of women in society: tends to lead to greater empowerment, and links to child survival rates and fertility rates.
  2. Improving the levels of health: improved education leads to increased awareness of hazards, for all citizens, but particularly women. Individuals are able to read about and be informed on issues such as child nutrition or risks of HIV/AIDs.

However the cost of providing free primary and secondary school education requires vast amounts of funding. Spending can be more efficient in urban areas, but more costly in rural areas. Improving access to secondary school education seems to be the hardest to achieve due to pressure students face to work for families. Also difficult to increase access for families with no previous background in schooling.

Access to Technologies

The innovative NGO now has 100,000 health volunteers with mobile phones (mobile- phone coverage is widespread in Bangladesh). When a volunteer finds a woman is pregnant, she texts the mother-to-be with advice on prenatal and, later, postnatal care. This is helping BRAC build up a database of maternal and child-health patterns in remote villages.

3. The Role of International Trade in supporting development

Bangladesh has successfully developed bilateral trade agreements with other countries such as India and has used LEDC status with the WTO to have preferential access to some EU countries to develop trade links. Since 1991, there has been a huge diversification away from just two products (Jute, Sugar) to a more manufacturing value added based economy and particularly textiles with significantly higher exports. The have been able to gain a competitive edge due to their preferential access agreements and then develop economies of scale to attract more Multinational Companies Centre for Policy Dialogue, Bangladesh

From 1980 t0 2014 the most significant shift was towards textile manufacturing and the increase in export revenue from $580 million to $33.4 billion in 35 years.
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Andrew McCarthy


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