Effects of brick kiln industry on agricultural productivity: A natural experiment in Bangladesh

Agriculture remains central to Bangladesh’s economy and food security, yet it is increasingly threatened by the rapid expansion of informal brick manufacturing that extracts fertile topsoil from cropland and generates heavy local pollution. This paper provides national-scale causal evidence on how brick kiln expansion affects vegetation health and agricultural productivity by combining long-run satellite observations with geolocated kiln data. We construct a spatiotemporal panel of unions and municipalities using annual the Moderate Resolution Imaging Spectroradiometer normalized difference vegetation index (MODIS NDVI) from 2002–2024 and a high-resolution inventory of 9,187 brick kilns detected through satellite imagery and machine learning. Using a continuous and staggered difference-in-differences design, we find no evidence of differential pre-trends, but we do find a clear and persistent deterioration in vegetation health following kiln establishment. The magnitude is economically meaningful: a marginal increase in kiln presence is associated with roughly a 1 percent annual decline in local vegetation productivity, with effects that persist and accumulate over time. These results are consistent with long-run soil degradation and chronic environmental exposure around kiln sites, and they imply substantial hidden costs of informal industrial growth in densely cultivated landscapes. The findings highlight the urgency of stronger enforcement of siting rules, of incentives for cleaner production technologies, and of land-use planning that protects high-productivity agricultural zones.