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Determinants of Rural-urban Inequality in Vietnam: Detailed Decomposition Analyses Based on Unconditional Quantile Regressions

Author

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  • Thanh Bui

    (Centre for Agriculture Policy, Vietnam)

  • Katsushi S. Imai

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan, and School of Social Sciences, University of Manchester, UK)

Abstract

This study examines determinants of the rural-urban gap of household welfare in Vietnam during 2008-2012 using national household data. We have used unconditional quantile regressions (UQR) to carry out quantile decomposition analyses to identify underlying causes for the rural-urban disparity across the entire distribution. Our analyses have overcome the limitations of Oaxaca-Blinder decomposition, namely, (i) decomposition is made only at mean and (ii) a dependent variable has a linear and parametric relationship with covariates. For these purposes, we have carried out detailed decomposition analyses and the UQR decomposition (Fortin et al, 2011) combined with the reweighting technique. Our results show that basic education is beneficial to the rural poor and ethnic minorities in improving their living standards. Remittances generally improve rural welfare, but do not reduce within- or between-inequality. Public policy should ensure easier access to education for the rural poor and support the self-employed to raise and stabilise income.

Suggested Citation

  • 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 Aug 2018.
  • Handle: RePEc:kob:dpaper:dp2017-01
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    References listed on IDEAS

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    More about this item

    Keywords

    Inequality; Rural-urban disparity; Quantile Regression; Decomposition; Vietnam;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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