Political Settlements & Bangladesh’s Human Development Success

A review of Naomi Hossain’s The Aid Lab: Understanding Bangladesh’s Unexpected Success

How did Bangladesh, a country once called a global ‘basket case’ upon its independence in 1971, transform into one of the most startling development successes of the 21st century? From an inauspicious set of adverse conditions including mass poverty, low human capital, few natural resources and a horrific exposure to devastating cyclones and famines, Bangladesh has become a Cinderella success story in human development terms. Naomi Hossain’s The Aid Lab investigates the origins of Bangladesh’s development success and what can other countries learn from its experience.

Hossain starts by acknowledging that steady if slow economic growth has been critical to making such human development gains possible. Bangladesh’s economy has grown annually at 4-5% since 1990, with low inflation and stable domestic debt on the backs of three economic trends: a garment-driven export industry (80% of exports, including approximately 3 million mainly female jobs), overseas remittances (up to 10% of GDP, including approximately 9 million mainly male overseas jobs) and expansive microfinance access (accounting for 13-17% of rural GDP and used by approximately half of all households). Consequently, Bangladesh’s per capita income in PPP terms has risen from $890 per capita in 1991 to $2780 in 2011.

Yet Bangladesh’s development trajectory is particularly striking because economic growth has quickly translated into significant human development wins, wins beyond even what its modest growth rates would have predicted: between 1971 and 2011, male life expectancy has risen by 20 years, female fertility rates have dropped from 7 to 2, and infant mortality rates have dropped from 223 to 47. Bangladesh has met many of its Millennium Development Goal targets, such as reducing poverty gap ratio, attaining gender parity at primary and secondary education, under-five mortality rate reduction, containing HIV infection with access to antiretroviral drugs, raising the percentage of children under five sleeping under insecticide-treated bed nets, and improving the detection and cure rate of tuberculosis. Bangladesh has also made remarkable progress in the areas of poverty reduction, reducing the prevalence of underweight children, increasing enrolment at primary schools, lowering the infant mortality rate and maternal mortality ratio, improving immunization coverage and reducing the incidence of communicable diseases.

Hossain’s important book argues that the key to Bangladesh’s development success lies in understanding why a strong political consensus emerged to pursue such a pro-poor development policy across governments and regimes. Hossain agrees with a World Bank 2010 report that the role of the state has been critical through its pursuit of a six-point plan: by creating sound macroeconomic policies; improving disaster management; making sound investments in public health and education; partnering with NGOs; supporting family planning; and encouraging labour migration. But if the how of Bangladesh’s development success is clearly understood, The Aid Lab’s contribution is to explore the political underpinnings of why this development consensus emerged.

Specifically, Hossain asks why, as Bangladesh careened between military and democratic regimes and as it recovered from one ecological disaster after another, did military, political and eventually industrial elites maintain a strong, consistent commitment to pursue pro-poor development? Said differently, how did Bangladesh achieve human development with both weak state capacity and weak governments?

Hossain’s primary argument is that the famine of 1974 was the formative event driving the creation of a ‘political settlement’ among elites to pursue human development and social protection policies. The famine—which she estimates killed 1.5 million people or 2% of the population—was the formative shock that created this new political consensus for three reasons: first, the ruling class began to believe their own survival depended upon fostering basic social protections in times of crisis and therefore wrote natural disaster protection policies, including health and education priorities, into state policies; second, the ruling class understood that basic minimum protection, in the context of acute exposure to both environmental disasters and global markets and a devastating civil war that left up to 3 million women without partners, would entail active efforts to reach poor rural women in particular; and third, the ruling class accepted the need to pursue pro-market, pro-poor development strategies in return for recognition/resources from the international community, including the space for the non-governmental action for which Bangladesh is now globally recognized. The widespread consensus that the Bangladesh state needed to provide the kind of human development that could buffer against disasters impelled Bangladeshi elites to embrace the international donor community and gave donors the latitude to experiment widely with ‘whatever works.’ This is how Bangladesh became ‘The Aid Lab.’

By exploring the political underpinnings that ultimately drove Bangladesh’s development successes, The Aid Lab is an important contribution to scholarship. By clearly pinpointing a set of causal claims that speaks to the heart of why Bangladesh’s political elite coalesced around a pro-poor development agenda and in successfully demonstrating that the searing experience of the 1974 famine was the formative event in the memories of political and economic elites, this book breaks new empirical ground in Bangladesh’s political history. The book is utterly successful in demonstrating that this famine radically altered elite perceptions and impelled a new commitment to pro-poor policies and therefore in demonstrating that Bangladesh’s development success is in no small measure political in origin. For example, she extensively quotes the founders of Bangladesh’s two most celebrated NGOs, BRAC and the Grameen Bank, as they date the origins of their signature achievements to the 1974 famine (pages 139-140).

The book is less successful in clearly evidencing the claim that it was specifically the 1974 famine (and not for example, the famine in close interaction with the nationalist struggle against West Pakistan in 1971, a claim she explicitly rejects on page 5) which drove the new political consensus. Hossain locates a range of other factors that contributed towards creating the pro-poor development agenda among the Bangladeshi elite. The most important of these appear to be: the relative linguistic and religious homogeneity of the country that limited the possibilities for a divisive ethno-linguistic politics; the minimal sociological distance between elites and masses, which helped develop an elite identification with the concerns of the masses; the limited geostrategic value of Bangladesh in the Cold War, which meant that political considerations did not trump development agendas; the absence of natural resources as a means of funding patronage networks which meant that elites had little alternatives but to focus on delivering human protection from ecological crisis; the failure of traditional patriarchal society to protect women during the early 1970s, which induced far-reaching and rapid changes in gender norms; and the emerging donor consensus on the key ingredients of the East Asian development successes (with Japan a particular touchstone for its ecological, ethnic and demographic similarities).

Yet we are left unclear how important these other factors are in forging the critical elite consensus that in turn drove the state to adopt its successful six-point development strategy. This is an especially important exercise if the book aims to distil lessons for other countries hoping to emulate Bangladesh’s successes. For example, Hossain gives contradictory accounts of whether it is decisive that the famine was immediately preceded by a nationalist movement that provided a radical break from the past in political, economic and social terms. She writes on page 5 that “Perhaps the most important insight of the book is that this critical event [1974 famine] was not, as might reasonably be assumed, the traumatic liberation struggle that founded the country. Instead, [it] can be traced to the devastating famine it suffered in 1974, only three years after independence: as many as 1.5 million people—2 percent of the population—died in this catastrophe.” Yet a dozen pages later, Hossain states that Bangladesh succeeded because ‘the process of national liberation and its aftermath built a social contract to protect the population against subsistence crisis, and it was on this foundation that human development could proceed’ (17).

This lack of causal clarity also plagues her empirical account: though the famine itself is the key empirical event, research on the 1974 famine suggests that it was importantly and perhaps even mainly driven by the severe economic and nutrition-based deprivations that preceded 1974, namely the 1970 cyclone and the 1971 national struggle which together killed, by some estimates, 3-4 million people and erased any buffer to cope with the next natural disaster. In and of itself, these claims are not contradictory: the decisive nationalist struggle and the searing psychological and sociological effects of the famine could be equally important in driving the creation of a new social contract between elites and masses. But since learning from Bangladesh’s experience requires a clear-headed understanding of the most important ingredients of its development success, the book could more clearly grapple with the relative importance of a ‘founding struggle’—perhaps the least replicable aspect of Bangladesh’s trajectory.

The Aid Lab concludes by posing important questions about how Bangladesh can sustain its development trajectory as it advances into a new stage of development. Economically, a growth model that is dependent upon on ready-made garment exports and migration render the country especially vulnerable to global economic shocks. Socially, the ‘whatever works’ approach of dual state and NGO service provision of health and education is unlikely to effectively scale. And politically, the individual empowerment that has underpinned microcredit organization has not yet scaled to institutionalized forms of collective power. These challenges are only exacerbated by the more several ecological challenges stemming from climate change.

Overall, this book is a much-needed work of scholarship that forces us to grapple with the ultimately political foundations of successful (and unsuccessful) development agendas. Founding regime moments, especially ones punctuated by massive human development crises, are key windows in which to understand how elites formulate their world views and perceive their political priorities.

Maya Tudor is an Associate Professor of Government and Public Policy in the Blavatnik School of Government at the University of Oxford. Dr. Maya Tudor’s research investigates the origins of stable, democratic and effective states across the developing world, with a particular emphasis upon South Asia. She was educated at Stanford University (BA in Economics) and Princeton University (MPA in Development Studies and PhD in Politics and Public Policy). She has held fellowships at Harvard University’s Belfer Center for Science and International Affairs, Oxford University’s Centre for the Study of Inequality and Democracy. During the 2018-2019 academic year, she is a fellow at Stanford University's Center for the Advanced Study of the Behavioural Sciences.

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