Session 7: COSTS AND CHALLENGES OF DEVELOPMENT

Thursday, Dec 9, 2021 | 6:00pm – 7:45pm | Bangladesh Time (GMT+6)

Dr Rizwanul Islam
Former Special Adviser, Employment Sector, International Labour Office, Geneva

Paper Title – Fifty Years of Development Experience of Bangladesh: An Employment and Labour Perspective

Abstract:

The basic purpose of this paper would be to take a fresh look at the narrative of economic growth in Bangladesh and its outcome from the perspective of an important factor of production – labour. This will be done in three parts. First, based on an identification of the drivers of economic growth during different sub-periods of the fifty years since independence, it will be shown and argued that the basic factors of production, labour, capital and technological change played their due roles. The role of labour is evident in three major drivers of growth, viz., HYV crops during the 1970s and 1980s, the readymade garment industry since the mid-1980s, and overseas migration. In addition, simple growth decomposition shows the growing importance of labour productivity in overall output growth as well as in manufacturing sector growth.

The second part of the paper will focus on how successful economic growth in Bangladesh has been in absorbing surplus labour. This part will start from the theories of growth and structural transformation a la Fisher (1939), Clark (1951), Kuznets (1966,1971) and Kaldor (1966) as well as the models of dual economies a la Lewis (1954) and Fei and Ranis (1961). While such theories talk about changes in the structure of economy in terms of sectors, this paper would look at the issue in terms of change in the sector composition of employment as a means towards the goal of absorbing surplus labour and moving towards the “Lewis turning point” where surplus labour is exhausted and real wages start rising.

The third part of the paper will focus on what has been the outcome of economic growth for workers. Here, the focus will be on real wages of domestic workers and cost of migration for overseas jobs. The latter will include monetary costs of migration as well as abuses faced by workers at both ends.