The Impact of the Global Commodity and Financial Crises on Poverty in Vietnam
AbstractEconomic growth in Vietnam has been fairly resilient to the global commodity and financial crises, but it is unclear why. In addition, the impact of the crises on employment and poverty is in dispute. We develop a dynamic computable general equilibrium model to decompose impacts and estimate distributional outcomes. Our results indicate that the 2008 commodity crisis increased employment and reduced poverty by favouring labour-intensive exports, especially in agriculture. The 2009 financial crisis reversed these gains. It pushed more than a million workers into unemployment and about 3 million people below the US$2-a-day poverty line, with the vast majority of these being rural dwellers. The net effect of the crises left Vietnam little changed from a baseline (no crises) path in terms of aggregate indicators including the poverty rate. An effective stimulus package has the potential to offset one third of the increase in poverty caused by the financial crisis leaving poverty rates below the (no crises) baseline.
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Bibliographic InfoPaper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number wp2010-98.
Length: 22 pages
Date of creation: 2010
Date of revision:
Economic crisis; growth; poverty; Vietnam;
Other versions of this item:
- Thurlow James & Tarp Finn & McCoy Simon & Hai Nguyen Manh & Breisinger Clemens & Arndt Channing, 2011. "The Impact of the Global Commodity and Financial Crises on Poverty in Vietnam," Journal of Globalization and Development, De Gruyter, vol. 2(1), pages 1-31, August.
- D5 - Microeconomics - - General Equilibrium and Disequilibrium
- G01 - Financial Economics - - General - - - Financial Crises
- I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
- O24 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-23 (All new papers)
- NEP-DEV-2010-10-23 (Development)
- NEP-SEA-2010-10-23 (South East Asia)
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