Search

Assumptions about time, value, labour, and health coalesce in the policy decision to extend the pension eligibility age in Australia from 65 to 67 years. Acknowledging the multiple, often incompati...

We provide new insights into the relationship between foreign investment and the labour productivity of domestic firms in the Vietnamese manufacturing industry. Using quantile regression analysis of a panel of firm-level data over a 2010–2015 study period, we find that the presence of foreign investment has a positive impact on domestic firm labour productivity through competition effects within the industry at the middle and high quantiles. We do not find significant evidence to support a positive relationship between foreign investment in downstream sectors and domestic firm labour productivity in upstream sectors, however. There are some indications that suggest a positive relationship between foreign suppliers in upstream sectors and labour productivity of domestic buyers in downstream sectors at the low and middle quantiles.

This study investigated the role of provincial governance on the growth of per capita income of Vietnamese households, using a balanced panel dataset for the period 2012-2014. Whereas we found no evidence for the influence of provincial governance when a linear fixed-effect regression estimator was used, the results from a fixed-effect quantile regression estimator reveal that provincial governance has a positive effect on several groups (but not the poorest) and the effect tends to be greater for better-off households. In addition, we find that wage employment plays a larger role in the income growth of poorer households, while returns on education are higher for richer households. The findings suggest that a mean regression approach that looks only at the role of explanatory variables on mean household welfare and does not consider differences in the distribution of household welfare, may miss some heterogeneity that is of interest to policy makers.

This study explores the dynamics of income and income inequality in Vietnam from 2004 to 2014. Two main population subgroups are investigated: the ethnic majority, known as the Kinh people, and the minority group, which includes 53 minor ethnicities in Vietnam. The findings show that the income gap among ethnic groups has increased over the last decade. The Gini index decomposition indicates that wages and nonfarm business income are the two main determinants of income inequality. Cultivation and agricultural side-line incomes were relatively evenly distributed, despite their recent smaller equalizing effect. Both sub-population groups have experienced a declining contribution from the agricultural sector to overall household income. Changes in income inequality in Vietnam by income source reflect the change in the structure of the economy from reliance on agriculture to non-agricultural economic activities.

Evidence exists of a fast increase in the returns to education in Vietnam in the 1990s and 2000s. However, there was a huge change in education policy in the mid-2000s, opening up opportunities for education providers to expand enrolment. This may lead to a decline in the returns to education in later years when the changes have generated sufficient effect. To provide up-to-date estimates of the returns, we re-visit the returns using updated large survey data up to 2014. We apply the OLS and Heckman selection estimators which can correct for selection bias and find that both estimators provide a consistent trend of the returns, which increased quickly up to the global financial crisis in 2008/2009 and then declined afterwards. This raises a question whether higher educated labour force is oversupplied.

While several studies have estimated returns to education in Australia, there is limited evidence regarding the influence of health on the returns. This paper identifies how health affects returns to education in the labour market using the Heckman selection bias-corrected model. We measured health status using a self-rated health item with five response categories ‘poor, fair, good, very good, and excellent’. The findings show that poor health or being unhealthy (defined as ‘poor’ or ‘fair’) interacts with education, such that the benefits of education (i.e. higher hourly wage rate) are curtailed in those with health problems; the adverse effect is stronger for those in lower skilled jobs. The estimated returns to an additional year of schooling on average over 2001–2017 is 7.43% and 6.88% for the healthy and unhealthy groups, respectively. Thus, the return for workers with poor health is 7.4% lower than the return for healthier workers (for each additional year of schooling). This gap in the returns is equivalent to a productivity loss of about $19–25 billion per year. The lower returns to education for workers with poor health likely results from lower productivity while at work rather than loss of working days as the estimate is based on an hourly wage rate (rather than days or hours absent from work). These lower returns may also be explained by unhealthy workers accepting lower paid jobs given the same levels of experience, skills and education that healthier counterparts have. The cost of poor health to labour market returns is further amplified in low-skilled occupations, a process which is likely to exacerbate socio-economic inequalities and undercut social mobility.

Purpose – Little econometric evidence exists on the determinants of nonfarm participation among ethnic minorities in Vietnam. The purpose of this paper is to examine the intensity of nonfarm participation and its correlates among ethnic minority households in Northwest Mountains – the poorest region of Vietnam. Design/methodology/approach – Factors affecting the level of nonfarm participation were examined by using a fractional logit model. In addition, regression analysis using analysis of variance models were used to compare the mean of household characteristics and assets between households with and without nonfarm employment. Findings – The study found that households depended heavily on agriculture for subsistence and their access to nonfarm employment is very limited. Households with nonfarm employment had much higher levels of education, income, assets and a much lower level of poverty than those without nonfarm participation. The intensity of nonfarm participation is positively associated with education levels, proportion of male working members and fixed assets but negatively correlated with the size of annual crop land and water surface for aquaculture. Also, the presence of nonfarm opportunities and paved roads in a commune increases the intensity of nonfarm participation for households living in that commune. Practical implications – The findings suggest that any poverty alleviation policies should aim at improving the access of ethnic minorities to education and nonfarm job opportunities. Originality/value – The study offers the first evidence of factors affecting the intensity of nonfarm participation among ethnic minorities in the study area.

This paper uses a dataset collected from peri-urban areas of Ho Chi Minh City, Vietnam to examine how the poor use their loans, and factors affecting their credit participation and credit constraints. The paper finds that the presence of many commercial banks in the areas does not help the poor, instead the poor rely heavily on informal credit. Loans in the periurban areas are mainly used for non-productive purposes, which stresses the importance of consumption smoothing. Better community relationships and interpersonal trust in morerural wards help households to access to credit. In urban areas, the poor rely more upon subsidized funds. A closer look at specified microcredit sources reveals that household behaviour differs in each market segment. Furthermore, the poor are highly credit-constrained. Wealthier-asset households among the poor appear to be less credit-constrained. The likelihood of credit constraints increases with the distance to the nearest banks, which suggests that credit supplyside intervention could help overcome credit constraints. Overall, the poor in urban areas are more credit-constrained because of exclusion by commercial banks and weaker interpersonal trust.

This paper uses a novel dataset of poor households in peri-urban areas in Vietnam to estimate impacts of small loans on child schooling. The Probit and Negative Binomial model estimates roughly indicate no strong evidence of the effect. However, breaking down credit into formal and informal credit and credit for boy and girl schooling provides better insights. The paper suggests that to obtain the target of sustainable poverty reduction, easing access to formal credit sources and exempting tuition and other school contributions are necessary steps to keep poor children in schools longer.

Vietnam has gone through massive economic restructuring from a socialist command economy to market-oriented economy. This provides an excellent example of a country that has experienced changes in competition regime. Economic reforms in late 1980s and 1990s and the introduction of pro-competitive policies in the first half of 2000s have radically altered the economic and, in particular, competitive environment. Understanding the evolution of competition across industries is an important step towards understanding the impact of economic reform on the economic performance of Vietnam as a result of the economic transition. In this paper, the authors investigate the evolution of competition in Vietnam during the economic transition using the price-cost margin (or Lerner Index) and the profit elasticity measure recently developed by Boone (Competition, 2000). This paper provides the first empirical study of intensity and evolution of competition across majority of industries in Vietnam in the last decade using firm-level data from the Vietnam Enterprise Census (VEC) conducted annually since 2000 by the Vietnam General Statistical Office (GSO).

Quantile treatment effects are estimated to study the impacts of household credit access on health spending by poor households in one District of Ho Chi Minh City, Vietnam. There are significant positive effects of credit on the health budget shares of households with low health care spending. In contrast, when an average treatment effect is estimated, there is no discernible impact of credit access on health spending. Hence, typical approaches to studying heterogeneous credit impacts that only consider between-group differences and not differences over the distribution of outcomes may miss some heterogeneity of interest to policymakers.

This paper employs the Ordinary Least Squares, Instrumental Variables and Treatment Effect models to a new dataset from the Vietnam Household Living Standards Survey (VHLSS) to estimate return to four-year university education in 2008. Our estimates reveal that income premium of four-year university education is about 97 percent above that of high school education, and robust to the various estimators.

There is an ongoing debate about whether microfinance has a positive impact on education and health for borrowing households in developing countries. To understand this debate, we use a survey designed to meet the conditions for propensity score matching (PSM) and examine the impact of household credit on education and healthcare spending by the poor in peri-urban areas of Ho Chi Minh City, Vietnam. In addition to matching statistically identical non-borrowers to borrowers, our estimates also control for household pre-treatment income and assets, which may be associated with unobservable factors affecting both credit participation and the outcomes of interest. The PSM estimates show a significant and positive impact of borrowing on education and healthcare spending. However, further investigation of the effects of the treatment reveals that only formal credit has a significant and positive impact on education and healthcare spending, while informal credit has an insignificant impact on spending. This paper contributes to the limited literature on peri-urban areas using evidence from one of the largest and most dynamic cities in Southeast Asia.

A common phenomenon about transition economies is that the return to schooling improves as economic reform progresses. Existing evidence suggests that Vietnam is not an exception to the pattern. However, the rate of return for the period 1992 to 1998 is still low relative to that of the world and of other transitional economies. To provide up-to-date estimates of the return and to test whether the return to schooling in Vietnam is rising and reaches other transitional economies’ rate of return, we re-examine the return in Vietnam from 1998 until before the current global economic crisis when the reforms have had a longer time to have an effect. We apply the OLS and Heckman selection estimators and find that the return has increased quickly during the later economic reform period but its pace has slowed down when the return reached the global average rate.