The debate on the aid-growth nexus isn't a new one. This much heated issue has received a good deal of empirical coverage for the time series data of Bangladesh. In this study we have revitalized the old debate to minimize existing literature gaps on the aid-growth nexus in Bangladesh. We have employed ARDL bound testing approach to examine the nature of relationship between aid and economic growth in Bangladesh. In the long run per capita foreign aid positively influence per capita gross national income. It exerts the same effect in short run too. In long run a 1 percent increase in per capita aid leads to 0.27 percent increase in per capita gross national income and in short run 10 percent increase in aid per capita increases per capita gross national income by 0.54 percent. A positive effect from the policy variable has also been obtained which justifies the implementation of pro trade liberalization policy in the post liberation-war period.

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This paper investigates how financial development is related to poverty reduction in a developing nation such as Bangladesh. Employing the ARDL bound testing approach to cointegration, the study finds that the variables representing poverty reduction and financial development are cointegrated. The long-run and the short-run estimations indicate that financial development reduces poverty. In particular, on average, a 1 percent increase in financial development reduces poverty by 0.6 percent in the long run, and in the short run, the rate is 0.4 percent. The results are robust even when controlling for military expenditure and macroeconomic stability variables. The study also discovers that even though military expenditure may seem innocuous in the short run, it hurts poverty reduction in the long run.

Public debt is intended to bridge the gap between domestic savings and investment. This paper examines the effect of public debt on economic growth in Bangladesh in the short run and the long run. It finds a significant positive relationship to exist between public debt and economic growth in the short-run while a significant rise in the public debt in Bangladesh appears to be a burden for the economic growth in the long run controlling for other determinants of growth. This suggests that funds have not been utilized in the productive economic avenues which might have improved the economic growth scenario in Bangladesh. Also, the adverse effect exerted by public debt may further be responsible for a reduction in investment and slower growth of capital stock, which eventually can hamper labour productivity growth in the country in the long run.