Structural Adjustment, Employment and Workers: Public Policy Issues and Choices for Bangladesh

Bangladesh adopted a series of structural reform programmes in the 1980s, which have been contentious from the beginning. The programmes are blamed for the failure to accelerate growth and reduce unemployment and poverty. The industrial workers also are believed to have been hurt by the reforms programmes. The author examines these issues in their historical and institutional contexts. The soft budget constraint allowed the public enterprises to hire more workers than was necessary, with the result that losses increased and productivity remained low. For the private sector, lax credit discipline was the analogue of the soft budget constraint, with a similar result in respect of productivity. As the reforms progress, particularly as fiscal and credit disciplines are strengthened, it is no longer possible to sustain the surrogate social security system. The author argues that efficiency improvements are necessary for industries in an open and outward-looking economy. He also places the issue of industrial workers in the overall context of unemployment and poverty. Masihur Rahman writes from the vantage point of an observer-participant while retaining objectivity in his analysis. The book should be of interest to: academic economists in the fields of trade, labour, industry, foreign aid and development economics; professional economists advising policymakers in Governments.