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The Impact of Urbanization on Income Inequality: A Study in Vietnam

Author

Listed:
  • Nguyen Minh Ha

    (Business and Economics Research Group, Ho Chi Minh City Open University, 97 Vo Van Tan Street, District 3, Ho Chi Minh City 700000, Vietnam)

  • Nguyen Dang Le

    (Department of Financial Informatics and Statistics, Ministry of Finance, Ho Chi Minh City 700000, Vietnam)

  • Pham Trung-Kien

    (Faculty of Economics, Binh Duong University, 504 Binh Duong Avenue, Binh Duong Province 590000, Vietnam)

Abstract

This paper explores the impact of urbanization on income inequality in Vietnam, using the regression estimation method with panel data including Driscoll and Kraay, and Pooled Mean Group. The research data cover 63 provinces in Vietnam from 2006 to 2016. The results show that in the long term, urbanization has an impact on reducing income inequality. In the short term, urbanization has a negligible impact on income inequality. The hypothesis of an inverted-U-shaped relationship between urbanization and income inequality is confirmed. The high school enrollment rate and the proportion of agriculture have an effect on reducing income inequality.

Suggested Citation

  • Nguyen Minh Ha & Nguyen Dang Le & Pham Trung-Kien, 2019. "The Impact of Urbanization on Income Inequality: A Study in Vietnam," JRFM, MDPI, vol. 12(3), pages 1-14, September.
    • Handle: RePEc:gam:jjrfmx:v:12:y:2019:i:3:p:146-:d:266000
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    19. Kolomak, Evgeniya, 2020. "Urbanization and income inequality: Cause or solution?," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 59, pages 55-70.

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