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Opportunities And Challenges In Agriculture And Garments: A General Equilibrium Analysis Of The Bangladesh Economy

Channing Arndt, Paul Dorosh, Marzia Fontana and Sajjad Zohir

International Food Policy Research Institute (IFPRI)
Department of Agricultural Economics, Purdue University
Bangladesh Institute of Development Studies (BIDS)

For the past two decades, Bangladesh has enjoyed steady growth in per capita incomes enabling a significant reduction in poverty. An increase in rice productivity, achieved through a combination of improved seeds, increased fertilizer use, and public and private investments in irrigation, played a major role in the increase in incomes. Among the other major factors were a large expansion in textile exports, made possible by changes in world demand, Bangladesh trade liberalization, and macro-economic stability; and increases in workers’ remittances. In order to accelerate or even maintain income growth rates and poverty reduction, future policies must be carefully designed to capture the benefits and minimize the risks of international trade and a constantly changing international environment.

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