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Does Urbanization Help Poverty Reduction in Rural Areas?Evidence from a Developing Country

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  • Nguyen, Cuong

Abstract

Urbanization and poverty have a two-way relationship. Using fixed-effects regression and panel data from household surveys, we estimate the effect of urbanization on income and consumption expenditure of rural households in Vietnam. Then we propose a simple estimate method to estimate the effect of urbanization on rural poverty. It is found that a one percent increase in urbanization leads to a 0.54 percent increase in per capita income and a 0.39 percent increase in per capita expenditure of rural households. In addition, a one percentage point increase in urbanization helps rural households decrease the poverty rate by 0.17 percentage point. However, we find an effect of urbanization on consumption of unhealthy goods: urbanization increases household expenditures on tobacco and wine.

Suggested Citation

  • Nguyen, Cuong, 2012. "Does Urbanization Help Poverty Reduction in Rural Areas?Evidence from a Developing Country," MPRA Paper 48660, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:48660
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    References listed on IDEAS

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    Cited by:

    1. repec:ipg:wpaper:2014-492 is not listed on IDEAS
    2. Nguyen, Cuong Viet & Nguyen, Hoa Quynh, 2015. "Do internal and international remittances matter to health, education and labor of children and adolescents? The case of Vietnam," Children and Youth Services Review, Elsevier, vol. 58(C), pages 28-34.
    3. repec:ipg:wpaper:2014-464 is not listed on IDEAS
    4. Nguyen, Cuong & Nguyen, Hoa, 2013. "Do Internal and International Remittances Matter to Health, Education and Labor of Children? The Case of Vietnam," MPRA Paper 48672, University Library of Munich, Germany.
    5. repec:ipg:wpaper:2014-454 is not listed on IDEAS
    6. repec:ipg:wpaper:2014-478 is not listed on IDEAS
    7. repec:ipg:wpaper:2014-490 is not listed on IDEAS

    More about this item

    Keywords

    Urbanization; household welfare; poverty; impact evaluation; household surveys; Vietnam; Asia.;

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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