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Climbing up the Ladder and Watching Out for the Fall: Poverty Dynamics in Rural Bangladesh

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Abstract

This paper analyses poverty dynamics in rural Bangladesh using a nationally representative panel dataset of 5,020 rural households interviewed in 2011/12, 2015, and 2019. Findings show that education, savings, assets, international remittance, non-farm employment, substantial safety net transfers, and women’s empowerment are key factors in breaking chronic and transient poverty. Rural infrastructure development and market access through improved connectivity are also critical for sustained poverty alleviation. On the other hand, woman-headed households (widowed, divorced or abandoned) are found to be particularly vulnerable to impoverishments. The results are consistent across multinomial logit, simultaneous quantile regression, and panel fixed effects models. Thus, policies and programs that address the determinants of chronic and transient poverty identified in this study hold promise for sustained poverty reduction in rural Bangladesh.

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Fig. 1

Source: IFPRI Bangladesh Integrated Household Survey (BIHS): 2011/12, 2015 and 2019 longitudinal surveys

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Notes

  1. Retrieved from http://databank.worldbank.org/data/home.aspx.

  2. Analogous to the USD1.90/person/day extreme poverty measure, the BBS lower poverty line identifies extreme poor households whose total expenditure is equal to the food poverty line.

  3. We also use the depth of poverty (i.e. the normalized shortfall of household from the poverty line) as outcome to run the household fixed effect regression on the balanced panel of households. We find similar results—education above primary level of male and woman members, savings and land holding, access to electricity, international remittance, engagement in the non-farm sector, women’s empowerment, and road connectivity are vital factors that lower the depth of poverty. On the other hand, woman-headed households with no spouse, and higher child dependency ratio increases the depth of poverty. Results are presented in Table 7.

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Acknowledgements

This work was undertaken as part of the CGIAR Research Program on Policies, Institutions, and Markets (PIM) led by the International Food Policy Research Institute (IFPRI). Funding for this research was provided by the United States Agency for International Development (USAID) under the Policy Research and Strategy Support Program (PRSSP) in Bangladesh through USAID Grant Number: EEM-G-00-04-00013-00. We thank Bob Baulch and Agnes Quisumbing at IFPRI for their valuable comments on this study, Julie Ghostlaw for her editorial services, and the survey enumerators and other staff of Data Analysis and Technical Assistance (DATA) for careful data collection. Tauseef also acknowledges financial support from the University of Manchester. All errors and interpretations are our sole responsibility.

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  1. International Food Policy Research Institute (IFPRI), Dhaka, Bangladesh

    Akhter U. Ahmed

  2. Department of Economics, University of Manchester, Manchester, M13 9PL, UK

    Salauddin Tauseef

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Appendix

Appendix

See Fig. 2 and Table 8.

Fig. 2
figure 2

Mean of per capita monthly expenditure by per capita expenditure quintiles from Round 1, 2011/12–2019

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Table 8 Attrition probit for BIHS, 2011/12 – 2019
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Ahmed, A.U., Tauseef, S. Climbing up the Ladder and Watching Out for the Fall: Poverty Dynamics in Rural Bangladesh. Soc Indic Res 160, 309–340 (2022). https://doi.org/10.1007/s11205-021-02808-2

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