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How does Vietnam's accession to the World Trade Organization change the spatial incidence of poverty?


  • Fujii, Tomoki
  • Roland-Holst, David


Trade policies can promote aggregate efficiency, but the ensuing structural adjustments generally create both winners and losers. From an incomes perspective, trade liberalization can raise gross domestic product per capita, but rates of emergence from poverty depend on individual household characteristics of economic participation and asset holding. To fully realize the growth potential of trade, while limiting the risk of rising inequality, policies need to better account for microeconomic heterogeneity. One approach to this is geographic targeting that shifts resources to poor areas. This study combines an integrated microsimulation-computable general equilibrium model with small area estimation to evaluate the spatial incidence of Vietnam's accession to the World Trade Organization. Provincial-level poverty reduction after full liberalization was heterogeneous, ranging from 2.2 percent to14.3 percent. Full liberalization will benefit the poor on a national basis, but the northwestern area of Vietnam is likely to lag behind. Furthermore, poverty can be shown to increase under comparable scenarios.

Suggested Citation

  • Fujii, Tomoki & Roland-Holst, David, 2008. "How does Vietnam's accession to the World Trade Organization change the spatial incidence of poverty?," Policy Research Working Paper Series 4521, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4521

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    Cited by:

    1. Tomoki Fujii, 2013. "Geographic decomposition of inequality in health and wealth: evidence from Cambodia," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 11(3), pages 373-392, September.
    2. Arguello, Ricardo, 2009. "The Regional Impact of Discriminatory Trade Liberalization on Colombian Agriculture," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(2).
    3. Jeong-Soo OH & Phouphet Kyophilavong, 2015. "Trade Liberalization and Poverty in Developing Countries: Literature Survey," International Journal of Economics and Empirical Research (IJEER), The Economics and Social Development Organization (TESDO), vol. 3(2), pages 86-94, Fabruary.
    4. Houssein Boumellassa & Hugo Valin, 2009. "Vietnam's Accession to the WTO: Expost Evaluation in a Dynamic Perspective," Economie Internationale, CEPII research center, issue 118, pages 13-42.
    5. Nguyen, Cuong & Tran Ngoc, Truong & Van der Weide, Roy, 2009. "Rural Poverty and Inequality Maps in Vietnam: Estimation using Vietnam Household Living Standard Survey 2006 and Rural Agriculture and Fishery Census 2006," MPRA Paper 36378, University Library of Munich, Germany.
    6. Jones, Nicola & Nguyen, Ngoc Anh & Nguyen, Thu Hang, 2007. "Trade liberalisation and intra-household poverty in Vietnam: a q2 social impact analysis," MPRA Paper 4206, University Library of Munich, Germany.
    7. Emiliano Magrini & Pierluigi Montalbano, 2012. "Trade openness and vulnerability to poverty: Vietnam in the long-run (1992-2008)," Working Paper Series 3512, Department of Economics, University of Sussex.
    8. Ditya Agung Nurdianto, 2016. "Economic Impacts of a Carbon Tax in an Integrated ASEAN," EEPSEA Special and Technical Paper tp201604t5, Economy and Environment Program for Southeast Asia (EEPSEA), revised Apr 2016.
    9. Hosaki Kono, 2011. "Economic Integration and Poverty," Chapters,in: The Economics of East Asian Integration, chapter 16 Edward Elgar Publishing.
    10. Duong, Nguyen Binh, 2016. "Vietnam-EU Free Trade Agreement: Impact and Policy Implications for Vietnam," Papers 992, World Trade Institute.

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    Rural Poverty Reduction; Population Policies; Economic Theory&Research; Achieving Shared Growth;

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