Waves of Change: Understanding Ascent, Descent and Persistence of Poverty in Rural Bangladesh

The paper examines the drivers of rural poverty and their evolution in Bangladesh over the last two decades. It uses four rounds of a nationally representative rural longitudinal survey from 1988 and 2008. Using the standard Probit approach, the analysis identifies the factors most likely to distinguish, first, the households that managed to escape poverty from the chronic poor, and second, the households that fell into poverty relative to the never poor households to understand the characteristics likely to explain the causes of descent. The results indicate that different factors are associated with the ascent and descent of households, and they also vary over time periods. Labor endowment, land ownership, education, shocks, and non-farm work play nuanced roles in helping movers escape poverty or protecting the vulnerable from falling. For example, in the 2000s, the results show a heightened role for non-farm sources of income, helping households with better labor endowment escape poverty. Education, on the other hand, is associated with protecting the non-poor from falling over the same period. Improved connectivity is found to reduces vulnerability while migration and land ownership are associated with helping the movers as well as protecting the vulnerable. Acknowledgement : The authors are grateful to Dr. Mahabub Hossain for making the longitudinal survey data avaiable for this analysis. The findings, interpretations, and conclusions expressed in this paper are those of the authors and do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work