Using Input–Output Analysis Framework to Explain Economic Diversification and Structural Transformation in Bangladesh

42 Pages Posted: 12 Jun 2017

See all articles by Valerie Mercer-Blackman

Valerie Mercer-Blackman

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD)

Amador S. Foronda

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD)

Mahinthan Mariasingham

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD)

Date Written: May 2017

Abstract

Existing literature on economic growth and structural change relies on trade data to make pronouncements about a country’s competitiveness and long-term growth prospects through the acquisition of capabilities. However, insufficient data give us a limited view of what is happening within the domestic economy, and how the development of manufacturing through links in the production process leads to the export of intermediate or final products. Using input–output data, this paper devises an agglomeration indicator to measure economic diversification and to compare Bangladesh with other key economies. In the process, we shed light on the symbiotic relationship between manufacturing and services as the country develops. Despite Bangladesh’s astounding growth over the past 15 years, diversification has been somewhat slower than expected for its level of development.

Keywords: Bangladesh, Business Services, Economic Diversification, Global Value Chains, Input–Output Tables, Ready-Made Garments, Structural Transformation

JEL Classification: D24, D57, F15, O14

Suggested Citation

Mercer-Blackman, Valerie and Foronda, Amador S. and Mariasingham, Mahinthan, Using Input–Output Analysis Framework to Explain Economic Diversification and Structural Transformation in Bangladesh (May 2017). Asian Development Bank Economics Working Paper Series No. 513. Available at SSRN: https://ssrn.com/abstract=2982886 or http://dx.doi.org/10.2139/ssrn.2982886

Valerie Mercer-Blackman (Contact Author)

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD) ( email )

Philippines

Amador S. Foronda

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD) ( email )

Philippines

Mahinthan Mariasingham

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD) ( email )

Philippines

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