Identification of key sectors in the Bangladesh economy: A linkage analysis approach

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Abstract
This paper purports to identify key sectors in the Bangladesh economy employing the concepts of forward and backward linkages. An attempt is made to rank sectors according to their employment and output potentials. The paper draws a distinction between gross and net linkages defined respectively on the inverses of the Leontief Technology Matrix and the domestic matrix. Using data for Bangladesh, it is shown that the transition from gross to net linkages implies significant divergence in sectoral rankings. This appears to be true for ranking of sectors in terms of output and employment, suggesting a potential conflict between employment and output generation potentials particularly in the industrial sectors. When net linkages are considered, agricultural sectors appear to rank high on both counts.