Bangladesh population

Development centered on Dhaka, population overload causes a loss of 6.0 pc of GDP


| Update:
03, 2021, 9:04:06 a.m.

The heavily focused development on Dhaka city and population share is negatively impacting Bangladesh’s gross domestic product (GDP), slashing its growth by 6.0 percent or more, according to findings revealed Thursday during a BIDS conference.

Such Dhaka-centric growth also reduces the growth of other cities and has an impact on per capita income inequalities, according to an article presented by Ahmad Ahsan of the Policy Research Institute of Bangladesh at the BIDS annual conference on ” Development: Dhaka’s overgrowth is detrimental to overall growth ”.

It also has an impact on overall urban development and causes traffic jams and pollution.

“There are also economic limits to concentration… Cities cannot develop in an unlimited way…”, he declared while sharing the contents of his article during a session of the second day of the conference which he attended virtually.

Former chief economist of the World Bank, Mr Ahsan said the cost of congestion was 2.0 to 3.0 percent of GDP as a direct effect. The growth of the city creates a proliferation of primates, concentrating population and development in a city center.

Primate proliferation (largest city) can undermine the growth of other cities and cities can proliferate due to market failures resulting from fixed costs and externalities of investments, network effects and circular cumulative causation.

Emphasizing corrective politics as the political elite prefers the growth of the primate city, he also said that was not acceptable in the growth pole.

Economist Ahsan, also a consultant to the United Nations, including the Food and Agriculture Organization, focused on neutral national and regional policies and local policies, saying these are issues integrated and must focus on microeconomic management, economic competitiveness, a good investment climate, investment infrastructure, connectivity, transport corridors, telecommunications, etc.

He said that migration, which greatly improves well-being, also has limits, even in advanced economies. He shared data from the World Development Index which shows the urban population share of the primate city in Bangladesh is 31.9%, or 3% in China, 6% in India, 7.4% in Indonesia, 22.6% in Pakistan and 23.2% cent in Vietnam

He cited another article by Mohammad Yunus, principal researcher at BIDS, which shows a gap between the east and the west of the country in per capita consumption by estimating income, poverty and inequality in the two regions.

The economist said the disparities could not narrow the gap between cities, adding that poverty is much more acute in the western districts than in the eastern districts. He cited a household income and expenditure survey in which western districts appear to experience greater convergence in poverty measures than eastern districts by 1%, be it the poverty rate, poverty gap or squared poverty gap.

The HIES estimates a partial elasticity between the rate of poverty reduction and growth that varies between -2.23 and -3.6 percent depending on the enrollment ratios, the poverty gap and the poverty gap in the country. square.

During the day two session, Azreen Karim presented a paper on Risk, Poverty or Policy: Determinants of Subnational Public Expenditure Allocation for Adaptive Disaster Reduction in Bangladesh, followed by Mohammad Abdul Malek on Rural Development in Bangladesh over Three Decades: Mahabub Hossain Panel Data Findings and the Way Forward.

During the session on the survival and development of women through major shocks, Victoria Baranove, Laura Zimmermann and Shyamal Chowdhury presented papers.

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