Analysis of Poverty Dynamics: Bangladesh Perspective

INTRODUCTION Like many other developing countries of the world, Bangladesh has been striving to alleviate poverty since its independence in 1971. Poverty is one of the major economic problems of this country. Recently the government of Bangladesh, World Bank, IMF and other international development agencies jointly formulated a national strategy for poverty reduction and prepared Poverty Reduction Strategy Paper (PRSP) in March 2003 with a view to achieving the goal of poverty alleviation drastically. (1) Reduction of poverty is a high priority agenda of the economy and is considered as an important goal of the government's development programs. Therefore, the government allocates a significant amount of national resources from its annual budget for achieving this goal. Similarly, all the five years plans have stated the commitment of the government to alleviate poverty through accelerated economic growth. In addition to the government efforts, a substantial number of local and foreign NGOs and international development agencies spend millions of dollars every year for this purpose. However, the achievement in reduction of poverty is very insignificant. Poverty rate at the national level of the economy still remains very high. Nearly 40 percent population of the country still lives in poverty. More than 60 million people still live in deprivation and two-thirds of them are in extreme poverty. Bhattacharya and Titumir argue that poverty reduction programs in Bangladesh may be characterised as an initiative with an absence of national framework and an abundance of donor's strategies. (2) Therefore, exploring the dynamics and multi-dimensional characteristics of poverty in Bangladesh is an important issue of policy analysis. The dynamics of poverty is referred to the assessment of the transitions or changes in the level of poverty over time. It involves with the assessment of the patterns and determinants of transitions in and out of poverty. It is argued that analysis of the dynamics of poverty is significant for policy formulation and designing programs for poverty reduction. It facilitates the better understanding the multi-dimensional aspects of poverty and its causes. The multi-dimensional characteristics of poverty explore not only its magnitudes such as extreme poverty, upper and lower poverty lines etc. but also view poverty as a result of a lack or lowness of multiple resource variables. The main objective of this study is to investigate and analyse the dynamics of poverty of Bangladesh. It is an essential aspect for understanding the analytical concept of poverty not only because it helps map out the causes and multidimensional characteristics of poverty but also facilitates resource allocation and policy formulation. Multidimensional characteristics and causes of poverty are significantly linked with various factors such as income, employment, geography, education, health conditions, access to resources and natural calamities such as flood and cyclone. Ahmed argued that geographical location was an important factor to analyse poverty. (3) Kam and Bose et al. found considerable variation in the incidence of poverty across the regions of the country. They argued that the geographical regions with the highest incidence of poverty were coastal areas, depressed regions of Sylhet division and the northwest districts of Rajshahi division. There are considerable variations and mobility among the poor. (4) Ali and Begum et al found similar results. They argued that there were some degree of mobility between poor and non-poor. This mobility worked in both directions- from poor to non-poor as well as non-poor to poor. From the evidence of 64 villages, they have revealed a significant fact that a large number of extreme poor households are trapped in poverty for over generations. (5) Although, some economists, such as Binayak Sen, argued that less opportunity for access to assets made the poor stay in chronic poverty. …