The most revealing feature of Dhaka’s struggling shopping malls is not the number of closed shutters, but the hesitation behind them. A market may have merchandise on its shelves, staff waiting behind counters and discounts displayed, yet customers can walk past.
The decline in activity at established destinations such as Eastern Plaza, Eastern Mallika, Mouchak Market, Police Plaza, and Shah Ali Plaza, alongside the closure of Karnaphuli Garden City, invites a larger question: What happens when consumers lose not only the capacity to spend, but also the confidence to do so?
It is easy to explain the retreat by pointing to online shopping and the arrival of newer commercial complexes. Both have altered the retail landscape. Digital platforms allow customers to compare prices, browse products and arrange delivery without negotiating Dhaka’s traffic.
Modern malls offer facilities that older markets may lack. Yet these changes explain where people shop, not necessarily why they are buying less.
When traders across different locations report falling sales, vacant shops, and difficulty meeting rent and salaries, the issue cannot be reduced to a competition between physical and digital stores. It points to a weakening of demand across the marketplace.
The pressure begins in the household budget. Food, housing, transport, education, healthcare, and utility bills claim first place because they cannot easily be postponed.
Clothing, cosmetics, shoes, jewellery and household upgrades come later. When the cost of essentials rises faster than income, discretionary purchases become the first casualties.
Families may continue to buy what they need, but they buy less frequently, choose cheaper alternatives, repair rather than replace, or simply wait. The absence of a customer in a shop may therefore represent a decision made long before that person reaches the market: The household has already decided that the purchase can no longer be justified.
This is the difference between having money and having disposable income. A person may receive the same salary as before and still feel poorer because that salary commands fewer goods and services.
Retailers face the reverse side of the same squeeze. Imported products become more expensive, while rent, electricity, wages, and service charges add to operating costs.
A shopkeeper cannot indefinitely absorb these increases. Prices rise, but customers whose incomes have not kept pace resist them. Traders are caught between costs they cannot control and buyers who cannot afford the prices required to cover those costs. Offering a discount may attract attention, but it cannot solve a structural loss of purchasing power.
The psychology of this retreat deserves as much attention as its arithmetic. Consumers do not make every decision by comparing prices and calculating immediate utility. They also respond to fear, expectations, habits, and the possibility of future hardship.
A family uncertain about employment, medical expenses, or next month’s bills may avoid spending even when it has some money left. Savings become a buffer against risks that feel increasingly difficult to predict. The pleasure of buying something new competes with the reassurance of keeping cash available. In uncertain times, reassurance often wins.
Behavioural economics offers a useful explanation. Daniel Kahneman and Amos Tversky’s prospect theory argues that people assess outcomes relative to a reference point and that losses can carry greater psychological weight than equivalent gains.
Their memorable formulation, “losses loom larger than gains,” helps explain why a consumer may experience spending as a potential loss of security rather than simply an exchange of money for a product.
The prospect of enjoying a new pair of shoes may seem modest beside the fear of being unable to meet an unexpected expense. The decision not to buy is then not evidence of indifference to consumption; it is a response to perceived vulnerability.
Another relevant concept is loss aversion, which can make consumers particularly sensitive to price increases. A product that once cost Tk 1,000 but now costs Tk 1,400 is not experienced merely as a new market price. The increase can feel like a loss of purchasing power, especially when wages remain unchanged.
Even if the item is still affordable in absolute terms, the buyer may resent paying more and postpone the purchase. Repeated price shocks can gradually reset expectations. Consumers begin to regard older spending habits as excessive and develop a more restrictive idea of what is necessary.
Richard Thaler’s work on behavioural economics also challenges the assumption that people behave like perfectly rational economic actors. His distinction between “econs” and “humans” captures the gap between theoretical decision-makers and actual people, whose choices are shaped by context and emotion.
A shopper may respond to a discount, but may also avoid a purchase because the household budget feels fragile. A retailer who assumes that lower prices alone will restore demand may misunderstand the customer’s real calculation.
The consumer is not simply asking whether an item is cheaper today; the consumer is asking whether buying it will create anxiety tomorrow.
There are, of course, problems within the retail sector itself. Some older shopping complexes have failed to maintain facilities or adapt to changing expectations. Poor ventilation, inactive escalators, neglected common areas, limited product variety, and weak customer service can make a visit less attractive. Buyers increasingly expect convenient payment options, reliable products, transparent prices, and the ability to compare alternatives.
A mall that once enjoyed prestige cannot depend indefinitely on its history. The difficulties of older complexes therefore reflect both an economic squeeze and a failure by some businesses and property managers to renew the shopping experience.
The damage does not stop at the shop counter. Retail connects importers, manufacturers, wholesalers, transport operators, delivery workers, landlords, and employees. When sales decline, retailers reduce orders.
Suppliers carry less stock, manufacturers may cut production, and businesses under pressure may reduce staff or delay investment. Lost jobs and lower incomes then weaken demand further.
A decline in consumption can thus become a cycle: Households spend less, businesses earn less, employment becomes less secure, and households become even more cautious. Empty corridors are only the visible part of a much wider chain.
This is why the condition of shopping malls should not be dismissed as nostalgia for an older style of shopping.
Karnaphuli Garden City’s closure is a reminder that commercial property cannot survive on its location or reputation alone. Nor should every struggling market be treated as proof that consumers have moved online.
The more important question is whether people across income groups have enough confidence and financial room to participate in ordinary consumption. A transfer of purchases from a physical shop to a website is a change in channel. A household abandoning purchases altogether is a sign of economic contraction.
Policy must therefore address the conditions that shape consumer confidence. Controlling inflation, creating secure employment, protecting real wages, ensuring fair competition, and reducing the burden of essential services are not merely social objectives; they are foundations of a functioning domestic market.
Reliable information and predictable economic management also matter because uncertainty influences spending decisions. Retailers, for their part, must improve facilities, use digital channels intelligently, maintain transparent pricing, and respond to customers with different budgets.
Neither public policy nor commercial innovation can guarantee success for every shop, but both can help create an environment in which demand has room to recover.
The quietness of Dhaka’s shopping malls is ultimately a story about the relationship between income, expectation, and trust in the future. People do not stop wanting attractive clothes, comfortable homes, or small pleasures simply because a market has changed.
They stop buying when the cost of those pleasures appears too high against the risks they face. Behind a vacant shop is a household making choices about food, rent, tuition, medicine, and the next uncertain month.
When ordinary purchases begin to feel financially dangerous, the crisis belongs not only to retailers. It belongs to an economy whose consumers are losing the freedom to spend.
HM Nazmul Alam is an academic, journalist, and political analyst based in Dhaka, Bangladesh. Currently he is teaching at IUBAT.