This study uncovers some important stylised facts about the structural changes in the rural nonfarm (RNF) economy in Bangladesh for the period 2000–2016 and identifies some broad determinants. Our work uses household‐level, secondary sources such as Household Income and Expenditure Survey, Labour Force Survey and Bangladesh Integrated Household Survey. We find that the positive relationship between landownership and rural income has become weaker in recent years, indicating the increasing role of nonland inputs in generating rural income. The share of RNF income in total rural income has increased substantially over the years. The increase in nonfarm income is largely driven by the nonfarm wage income of the richer households, indicating adverse distributional consequences. There are also indications for specialisation in nonfarm activities—the share of income from the ‘mixed’ sources of farm and nonfarm has decreased, and the ‘only nonfarm’ source has increased. Households tend to move away from agriculture and specialise in RNF occupations as the education level increases. Our results offer important insights into rural development strategies and contribute to the broader questions of the development discourse on the structural changes in developing countries.

No abstract

This study extends the recent debate on the rate of return on cattle rearing in India, triggered by Anagol, Etang, and Karlan (2017) and followed by others, to the Bangladeshi context and finds that the apparent paradox of widespread cattle rearing despite negative returns in India is absent in Bangladesh. We use a nationally representative two-year panel data for rural Bangladesh and find that the average and marginal returns on raising cows and bullocks are positive and high in both 2011 and 2015. We show that appreciation of the value of cattle is the major contributing factor to positive returns. The existence of cattle markets where cattle can be freely traded for slaughter, milk production, or for any other purpose—which is constrained to various degrees in India—is the key to high and positive returns in Bangladesh.

We use Indian livestock census data to show that states with more stringent slaughter laws perform better in terms of cattle population growth than states where slaughter acts are more enabling. We also show that the growth in cattle population is caused by an increase in female crossbred cattle and more so in the states where slaughter rules are very restrictive. Despite a complete ban on cow slaughter in some states, they do not show any balance between male and female cows. These results are non-intuitive and have strong political and policy implications but require further investigation.