Agricultural mechanization and economic development in Bangladesh: evidence from time-series analysis

Abstract

Bangladesh’s economy benefited greatly from agricultural mechanization; however, it also faces challenges. The objective of this study was to examine the effects of mechanization on crucial economic indicators between 1991 and 2022. Advanced statistical and econometric techniques were applied to carry out the study. Despite the fact that the quantities of power tillers and irrigation equipment have a negative impact on crop production and gross domestic product, respectively, the study’s findings indicate that agricultural mechanization has generally positive and significant effects on both. However, agricultural mechanization has a negative and significant impact on income inequality and employment in the agricultural sector; in contrast, energy consumption has a favorable effect on income inequality.  The number of electricity users, irrigation equipment, and arable land area also has positive effect on employment creation. The study suggests that advanced farming techniques, timely cultivation, reduced input waste, more irrigation capacity, shorter harvest periods, and lower production costs are the main determinants of increased crop production and gross domestic product. Nevertheless, financial barriers to small-scale farmers, high-cost machinery, unfair distribution of machinery resources, and fragmented land contribute to increasing income inequality. Moreover, lack of skills, limited access to training facilities, and fewer job opportunities are responsible for declining employment, although the adoption of advanced technologies enhances employment opportunities. To overcome challenges in establishing agro-service centers, encouraging eco-friendly mechanization, reforming land policies, providing low-interest loan facilities, and establishing machinery rental service centers are necessary in Bangladesh.

Bangladesh J. Agril. Res. 50(4): 311-330, December 2025