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Role of Bangladesh Small and Cottage Industries Corporation in Poverty Reduction

Author

Listed:
  • Mohammed Ziaul Haider
  • Champa Bati Dutta
  • Ohidul Islam Siddiqui

Abstract

This study investigates the role of Bangladesh Small and Cottage Industries Corporation (BSCIC) in poverty reduction of Bangladesh. A total of 91 workers are surveyed who work in BSCIC estates and non-BSCIC manufacturing firms in the south-west region of Bangladesh. This study has used both panel and cross-section approaches. The study findings indicate that BSCIC has a significant role in industrial expansion and poverty reduction in Bangladesh. The regression results reveal that BSCIC significantly influences household consumption and poverty reduction. A 1 per cent increase in income from BSCIC will increase the yearly household consumption by 0.73 per cent, whereas it is only 0.36 per cent in case of non-BSCIC income. The impact of income increase on consumption is more than double for the BSCIC group households in comparison with non-BSCIC group households. In cross-section analysis, the purchasing power parity (PPP) at local currency of US$ 1.25 is considered in this study to construct poverty line. The result shows that, for an increase in the income from BSCIC by US$ 1 per month, income over poverty line increases (or the poverty gap decreases) by US$ 0.028 per month per household on average. Therefore, this study suggests for planned expansion of BSCIC for poverty reduction in Bangladesh.

Suggested Citation

  • Mohammed Ziaul Haider & Champa Bati Dutta & Ohidul Islam Siddiqui, 2015. "Role of Bangladesh Small and Cottage Industries Corporation in Poverty Reduction," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 16(1), pages 103-121, March.
    • Handle: RePEc:sae:soueco:v:16:y:2015:i:1:p:103-121
    DOI: 10.1177/0972063415575130
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    References listed on IDEAS

    as
    1. International Monetary Fund, 2005. "Bangladesh: Poverty Reduction Strategy Paper," IMF Staff Country Reports 2005/410, International Monetary Fund.
    2. World Bank, 2011. "World Development Report 2011 [Rapport sur le développement dans le monde 2011 : Conflits, sécurité et développement - Abrégé]," World Bank Publications - Books, The World Bank Group, number 4389.
    3. Christopher Garroway & Juan Ramón de Laiglesia, 2012. "On the Relevance of Relative Poverty for Developing Countries," OECD Development Centre Working Papers 314, OECD Publishing.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Poverty reduction; household consumption; manufacturing firm; BSCIC; south-west region of Bangladesh;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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