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Neoliberalism and Housing Affordability Crisis in Dhaka Where Market-Enabling Efforts Failed

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Accessible Housing for South Asia

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Abstract

The rise of neoliberalism was instigated by the failures of welfare states in the western world in the 1970s. Policies were formulated to ‘extend market discipline, competition, and commodification throughout all sectors of society’ because of the diminishing profitability by the mass production concept of Fordism and increasing public budget deficits. As a result, the social good housing was commodified too and considered as an investment asset globally. Such transformation has intensely influenced the right to adequate housing endorsed by the constitutions across the world. The neoliberal policies have shaped the housing provision system worldwide, where the private market has been considered as the absolute provider of housing for all income groups according to demand but not need. From the literature, the most prominent characteristics of the neoliberal housing market have been identified as: 1. Homeownership focused housing provision to uphold asset base welfare system; 2. ‘Unlocking land values and new geographies of the cities’and 3. Affordability crisis. Thatcherism and Reaganism aggressively implemented neoliberal reforms in the 1980s which gradually influenced most of the countries in the world. Neoliberalism was introduced in developing and underdeveloped countries through Structural Adjustment Programs (SAPs) and measures to reduce budget deficits. Bangladesh accepted the SAP reform packages as the aid conditionality of IMF in the early 1980s and initiated denationalization of industries. The study has analysed the impacts of neoliberal policies on housing provision in Dhaka according to identified three prominent neoliberal housing market characteristics and the malfunction market enabling roles of the state that ultimately resulted in acute housing affordability crisis for limited-income households. The findings are based on secondary and grey materials, which have been analysed and validated by key personnel interviews. The findings will have some policy implications to tackle the housing affordability crisis of Dhaka.

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Notes

  1. 1.

    Key informants include housing experts, developers and professionals from state housing agencies. The name and designation have not been provided here due to page limitation.

  2. 2.

    Most of the rental apartments for govt. employees as, for example, in Motijheel, Azimpur or Baily road Officer’s Colonies were developed in provincial capital Dhaka during Pakistan period. Though public rental housing contributed only 8% of total housing need of this group, such initiatives were further deprioritized when the Second Five-Year Plan (1980–1985) mentions that ‘unjustified construction of staff housing should be stopped given the resource constraints and other pressing needs’. And the Fifth Five-Year Plan envisions not on rental housing rather on construction of flats for sale on hire-purchase basis for govt. employees.

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Author information

Authors and Affiliations

  1. Urban and Rural Planning Discipline, Khulna University, Khulna, Bangladesh

    Fawzia Farzana

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  1. Fawzia Farzana
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Editors and Affiliations

  1. Research and Information System for Developing Countries,, World Resources Institute India, New Delhi, India

    Amitabh Kundu

  2. University of the Azores, Angra do Heroísmo, Portugal

    Tomaz Ponce Dentinho

  3. Sindh Agriculture University, Tandojam, Pakistan

    Habibullah Magsi

  4. Housing and Urban Development Corporation, New Delhi, India

    Kanika Basu

  5. University of Calcutta, Kolkata, India

    Sumana Bandyopadhyay

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Farzana, F. (2022). Neoliberalism and Housing Affordability Crisis in Dhaka Where Market-Enabling Efforts Failed. In: Kundu, A., Ponce Dentinho, T., Magsi, H., Basu, K., Bandyopadhyay, S. (eds) Accessible Housing for South Asia. Springer, Cham. https://doi.org/10.1007/978-3-030-88881-7_5

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