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Sources of Regional Income Disparity in Rural Vietnam: Oaxaca-Blinder Decomposition


  • Takahashi, Kazushi


This paper investigates determinants of regional income disparity in rural Vietnam, with special emphasis placed on the roles of human capital and land. We apply a decomposition method, suggested by Oaxaca and Blinder. We found that returns to assets rather than endowments, especially those of human capital, are one of the leading factors to account for income differences across regions. We also found that substantial improvements of returns to human capital in the Red River delta region are a driving force to catch up with Mekong River delta region. Unexpectedly, differences in land endowment do not strongly correlate with regional income disparity because better access to land in a region was partially offset by lower returns.

Suggested Citation

  • Takahashi, Kazushi, 2007. "Sources of Regional Income Disparity in Rural Vietnam: Oaxaca-Blinder Decomposition," IDE Discussion Papers 95, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  • Handle: RePEc:jet:dpaper:dpaper95

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    References listed on IDEAS

    1. Van de Walle, Dominique, 1998. "Protecting the poor in Vietnam's emerging market economy," Policy Research Working Paper Series 1969, The World Bank.
    2. Dominique van de Walle & Dorothyjean Cratty, 2004. "Is the emerging non-farm market economy the route out of poverty in Vietnam?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 12(2), pages 237-274, June.
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    Cited by:

    1. Thanh Bui & Katsushi S. Imai, 2017. "Determinants of Rural-urban Inequality in Vietnam: Detailed Decomposition Analyses Based on Unconditional Quantile Regressions," Discussion Paper Series DP2017-01, Research Institute for Economics & Business Administration, Kobe University, revised Jun 2017.
    2. Mohammed, Essam, 2011. "Pro-poor benefit distribution in REDD+: Who gets what and why does it matter?," MPRA Paper 43648, University Library of Munich, Germany.
    3. Nguyen, Binh Giang, 2008. "Improving the Foreign Direct Investment Capacity of the Mountainous Provinces in Viet Nam," IDE Discussion Papers 152, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    4. Xuan-Binh Vu & Son Nghiem, 2016. "Analysis of GDP trends and inequalities in Vietnam`s provinces and groups of provinces," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 6(7), pages 167-186, July.

    More about this item


    Income inequality; Human capital; Land; Vietnam; Income distribution; Human resources; 所得不平等; 人的資本; 土地; ベトナム; 所得分配; 人的資源;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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