Mahmud, WahiduddinAhmed, SadiqMahajan, Sandeep2017-08-282017-08-282008https://hdl.handle.net/10986/28037Bangladesh has in recent decades achieved reasonably rapid economic growth and significant progress in social development indicators despite many impediments: the desperate initial conditions after gaining independence, lack of resources, natural disasters, widespread corruption, and a record of systemic governance failure. By identifying the sources of growth stimulus and the drivers of social transformation, the paper addresses what it calls Bangladesh's development surprise. The policy-making process is analyzed as the outcome of incentives created by patronage politics as opposed to the compulsion for the government to play an effective developmental role. The paper examines the governance-growth nexus as affecting the pace and quality of growth and its inclusiveness. If the governance environment has been barely adequate to cope with an economy breaking out of stagnation and extreme poverty, it increasingly may prove a barrier to putting the economy firmly on a path of modernization and global integration. Bangladesh's experience also shows that it is possible to make rapid initial progress in many social development indicators by creating awareness through successful social mobilization campaigns and by reaping the gains from affordable low-cost solutions. Further progress, however, will require increased public social spending and improved quality of public service delivery.en-USCC BY 3.0 IGOACCOUNTABILITYADVERSE EFFECTAGRICULTURAL LOANSAGRICULTUREAMORTIZATIONBANK LENDINGBANK LOANSBANKING SECTORBANKING SECTOR REFORMSBANKING SYSTEMBENEFICIARIESBENEFICIARYBONDED WAREHOUSESBUDGET DEFICITBUREAUCRACYBUSINESS COMMUNITYBUSINESS CYCLECAPITAL INFLOWSCAPITAL INVESTMENTCENTRAL BANKCLOSED ECONOMYCOMMERCIAL BANKINGCONFLICT OF INTERESTCONSUMER GOODSCONSUMER PRICE INDEXCONSUMPTION EXPENDITURECORE GOVERNANCECORRUPTIONCOUNTRY DATACREDIBILITYCREDIT EXPANSIONCRONYCURRENCYCURRENT ACCOUNT DEFICITDEBTDEFAULTERSDEMOCRACYDEMOCRATIC INSTITUTIONSDEREGULATIONDEREGULATION OF INTERESTDEVALUATIONDEVALUATIONSDEVELOPING COUNTRIESDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDEVELOPMENT PROJECTSDEVELOPMENT STRATEGIESDEVELOPMENT STRATEGYDIRECT INVESTMENTDOMESTIC BORROWINGDOMESTIC CURRENCYECONOMIC COMPETITIVENESSECONOMIC DEVELOPMENTECONOMIC FUNCTIONSECONOMIC GEOGRAPHYECONOMIC GROWTHECONOMIC LIBERALIZATIONECONOMIC ORDERECONOMIC PERFORMANCEECONOMIC REFORMSECONOMIC RELATIONSECONOMICS RESEARCHENTRY BARRIERSEQUIPMENTEXCHANGE CONTROLEXCHANGE RATESEXPENDITUREEXPORT GROWTHEXPORTERSEXPORTSEXTERNAL DEFICITSEXTREME POVERTYFINANCIAL LIBERALIZATIONFISCAL DEFICITFISCAL DEFICITSFISCAL POLICIESFISCAL POLICYFLEXIBLE EXCHANGE RATEFLOATING EXCHANGE RATEFOREIGN AIDFOREIGN CAPITALFOREIGN EXCHANGEFOREIGN EXCHANGE RESERVESFOREIGN INVESTORSGDPGINI COEFFICIENTGLOBAL MARKETSGOOD GOVERNANCEGOVERNANCE DATAGOVERNANCE ENVIRONMENTGOVERNANCE PROBLEMGOVERNANCE PROBLEMSGOVERNMENT EFFECTIVENESSGOVERNMENT EXPENDITUREGOVERNMENT POLICIESGOVERNMENT REVENUEGOVERNMENT SUPPORTGROSS NATIONAL SAVINGSGROWTH PERFORMANCEGROWTH RATEGROWTH RATESHOST COUNTRIESHUMAN DEVELOPMENTIMMUNIZATIONIMPORT QUOTASINCOME DISTRIBUTIONINCOME GROWTHINCOME INEQUALITYINCOME LEVELSINCOME TAXINEFFICIENCYINEQUALITYINFLATIONINFLATION RATEINFRASTRUCTURE DEVELOPMENTINSTITUTIONAL DEVELOPMENTINSTITUTIONAL REFORMSINSTITUTIONAL WEAKNESSESINTEREST PAYMENTSINTEREST RATESINTERNATIONAL BANKINTERNATIONAL DEVELOPMENTINVESTMENT CLIMATEINVESTMENT INCOMESINVESTMENT RATEINVESTOR PROTECTIONJUSTICE SYSTEMLEGAL PROVISIONSLETTERS OF CREDITLOANLOAN DEFAULTLOAN RECOVERYLOAN REPAYMENTLOCAL BUSINESSLOCAL COMMUNITIESMACROECONOMIC ADJUSTMENTMACROECONOMIC IMBALANCESMACROECONOMIC MANAGEMENTMACROECONOMIC POLICIESMACROECONOMIC REFORMSMACROECONOMIC STABILITYMACROECONOMIC STABILIZATIONMACROECONOMICSMARKET PRICESMARKET REFORMSMICROCREDITMONETARY POLICYMULTILATERAL INSTITUTIONSNATIONAL INCOMENATIONAL POLICIESNATURAL DISASTERSNATURAL MONOPOLYNATURAL RESOURCESNONGOVERNMENTAL ORGANIZATIONSOPEN ECONOMYPARLIAMENTPATRON-CLIENT RELATIONSHIPSPER CAPITA INCOMEPOLITICAL AGENDAPOLITICAL ECONOMYPOLITICAL INFLUENCEPOLITICAL LEGITIMACYPOLITICAL PARTIESPOLITICAL PARTYPOLITICAL STABILITYPOLITICAL SYSTEMPOOR GOVERNANCEPRIMARY EDUCATIONPRIMARY SCHOOLPRIVATE BANKSPRIVATE CAPITALPRIVATE INVESTMENTPRIVATE SECTOR DEVELOPMENTPUBLIC DEBTPUBLIC EXPENDITURESPUBLIC GOODPUBLIC INVESTMENTPUBLIC PROCUREMENTPUBLIC SERVICE DELIVERYPUBLIC SPENDINGPUBLIC UTILITIESREAL EXCHANGE RATEREAL GDPREGULATORY FRAMEWORKREGULATORY QUALITYREMITTANCESRULE OF LAWSAVINGS CERTIFICATESSECONDARY SCHOOLSSOCIAL DEVELOPMENTSOCIAL SERVICESTAXTAX COMPLIANCETAX EVASIONTAX EXEMPTIONSTAX POLICIESTAX REGIMETAX SYSTEMTELECOMMUNICATIONSTOTAL REVENUETRADE DEFICITTRADE LIBERALIZATIONTRADE POLICYTRADE PROTECTIONTRADE UNIONSUNBUNDLING GOVERNANCEURBANIZATIONVALUE ADDEDVESTED INTERESTSVOTERSWAGESWITHDRAWALWorking PaperWorld Bank10.1596/28037