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PPRC Special Report | State of the Real Economy

Bangladesh's hidden economy is running on empty

8,067 Households 432 PSUs Survey-weighted baseline

Households are carrying shocks with almost no monthly cushion: average income and expenditure now leave only BDT 70 at month's end.

PPRC State of the Real Economy Mid-2025 Baseline
Systemic Thresholds

The system is at its limit.

The Hollow Middle
17.97%

Households above the poverty line but below the median per-capita monthly income, occupying a zone of non-poverty without stability.

Underemployment
37.7%

Work exists. Income stability does not.

Urban Gini
0.532

Urban expenditure inequality remains sharply above rural levels.

Food Stress (Poorest Decile)
12.2%

Bottom-decile households reporting skipped meals.

Full-Day Hunger (Poorest Decile)
8.8%

At least one full day without food in the last month.

Household Balance Sheet

No margin remains.

Income and expenditure now sit almost on top of each other. The household economy is still moving, but without spare room.

The surplus is nominal.

At national level, the monthly surplus is BDT 70.

Debt replaces savings.

Across lower deciles, liabilities overtake buffers. Resilience is no longer asset-backed.

Fragility becomes structural.

The problem is no longer episodic shock. It is permanent exposure concentrated at the bottom.

Balance Sheet

Income vs Expenditure

BDT / month
Income and expenditure nearly cancel out.
View evidence table
Systemic Limit
BDT 70

This is what remains.

SYSTEM

The system holds. Households do not.

State of the Real Economy | PPRC 2025
Stress Ecology

Shocks are absorbed by households.

Health shocks, debt stress, and food insecurity cluster tightly. When buffers collapse, shocks are absorbed at household level, forcing the poorest households to use food as their primary adjustment variable.

Risk Stack

Co-occurring Stress

Healthcare as crisis trigger
67.4%
Chronic illness prevalence
51.3%
Slum HH ceasing beef & milk
76.0%
Underemployment
37.7%
Primary
Deficit
Food Stress

Bottom-Decile Meals

% of HH
Food is the adjustment variable
Skipped meals concentrate at D1.
View evidence table
Measured Effect

Underemployment

Odds ratio
Limited work hours raise skipped-meal odds.
View evidence table
Statistical association. See method note.
Measured Effect

Shock & Distress

OR
Shock exposure → debt stress
2.46×
Distress → harassment
2.78×
Remittance → lower debt stress
0.61×
Below poverty → debt stress
1.95×
Statistical association. See method note.
0.532
Structural Divides

Exposure is uneven.

Urban households face steeper expenditure inequality, while remittance-linked resilience concentrates in upper deciles.

Urban
Premium
Inequality Profile

Urban vs Rural Gini

Expenditure inequality
Urban inequality runs markedly steeper.
View evidence table
Buffer Access

Remittance by Decile

% by decile
Remittance access is concentrated higher up.
View evidence table
Distributional Signals

Vulnerability Card

Female-headed in poorest decile
23.75%
Female work participation
25.55%
D10 remittance share
17.8%
Governance & Protection

Protection fails under stress.

Governance burdens intensify for households already in distress, while safety-net targeting reveals both undercoverage and inclusion errors.

Governance Friction

Hoirani / Reported Harassment

% reporting
Health services remain the sharpest friction point.
View evidence table
Safety Net

Targeting Mismatch

% of households
Coverage misses many of the eligible poor.
View evidence table

Access remains.

Bargaining power does not.

Residual Resilience

Access without bargaining power.

Digital access is widespread. Productive digital capability is not. Households can view the economy through screens, but remain unevenly positioned to participate in it.

Adjusted Associations

Inference Layer

Internet access → higher observed income
+32.4%
Internet access → optimism
1.45×
Shock exposure → debt stress
2.46×
Distress → harassment
2.78×
Statistical association. See method note.
Digital Access

The Glass Screen Divide

% ownership
Smartphones are common. Computers remain marginal.
View evidence table
Resources

Citation & Data Access

Study Citation

Rahman, H. Z., Hashemi, S. M., Wazed, M. A., Rabbani, M. G., Shameem, N., Hassan, M. I., Lamisha, M. R., Hossain, B., & Huq, M. (2025). The State of the Real Economy. Dhaka, Bangladesh: Power and Participation Research Centre (PPRC).

Web Special Report Citation

Power and Participation Research Centre (PPRC). (2025). State of the Real Economy: A Baseline of Fragility. Dhaka, Bangladesh: PPRC Evidence Platform.

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