Bui Dinh Hoa Tap chi KHOA HQC & CONG NGHE 82(06): 113 117 A STUDY ON THE FINANCIAL GAP BETWEEN RICH AND POOR CITIZENS OF SOME COMMUNES IN THE SURROUNDING AREA OF THAI NGUYEN CITY Bui Dinh Hoa* College ofAgriculture and Forestry - TN SUMMARY Results of the study showed that the income differentiation between families who resided in Dong Bam and Phuc Triu communes and among families in each commune was quite clear The results also reflected the fact that the farming households often had lower income than non-farming households The study pointed out the main causes leading to the gap of income such as the impact of industrialization and urbanization; irrational investment for economic regions and sectors, inadequate public services; inefficiency of poverty reduction programs; disadvantages of geography and natural conditions, the special characteristics of poor households To limit the gap of income between the rich and the poor, it is extremely necessary to simultaneously implement such measures as providing opportunities for the poor to access social services, training and improving the knowledge of the poor, making a harmonious relationship between economic growth and social justice; prioritizing investment on agricuhure and rural areas; researching and launching policies for the poor Key words: Thai Nguyen, gap between rich and poor, income, rural areas, the poor STATEMENT AND RATIONALE OF THE STUDY Our country has implemented the renewal campaign toward Socialist-oriented market economy for over 20 years As a result, the economic growth is usually stable Citizen's living standards have gone up gradually We have also made a quite good relationship between economic development and social justice However, notable weakness still exists; especially, social inequality and gap between rich and poor have been widening, mostly in rural areas surrounding cities such as Thai Nguyen city The question remains, what is happening? The answer may refer to a variety of meanings First of all, it can show the socioeconomic relationship, which helps us find out solufions for economic growth and the differentiation between the rich and the poor For these reasons, the study on the gap between rich and poor in some communes in the surrounding area of Thai Nguyen city is really helpfLil Tel: 0983 640108 AIMS AND RESEARCH METHODOLOGY Aims The research was conducted to (1) assess the gap between rich and poor in some communes in the surrounding area of Thai Nguyen city, and (2) to propose and complete solutions shortening the gap and ensuring the stable development of those communes Research methodology For secondary documents: they were collected from many sources such as reports, magazines, data of Department of Statistics through the investigation into people's living standard (from 2004 to 2008) For primary data: based on methods of income ratio calculation, we gathered related data from 120 households in Dong Bam and Phuc Triu communes in the surrounding areas of Thai Nguyen city, using random sampling method After that, we ranked incomes per capita of each commune in increasing order and then equally divided each commune into groups, among which group consisted of the ones with the lowest income, on the other hand, group included the ones with the highest income 113 82(06):I13-117 Tjtp chi KHOA HQC & CONG NGHg Bui Dinh Hoa Dong Bam, the income of group was 5.14 times more than that of group 1, 0.74 times more than the rate of income disparity between the richest and poorest group in the province (4.4 times) In Phuc Triu, the rate was 4.45 times, 0.01 times higher than that in the province It is the fact that wherever people have high income, the inequality between rich and poor is clearer As seen in Figure I, the income of all groups in Dong Bam was similar to the groups in Phuc Triu The income of group I in both communes was much less than group FINDINGS AND DISCUSSION The results of the survey showed that there was an obvious income difference between the two communes and among the families who lived there The average income per head per month in Dong Bam was 1.499.488 VND, which was 453,488 VND more than that of the whole province (1,046,000VND) Whereas, the average income per capita in Phuc Triu was 949,778 VND, 96,222 VND less than that in the whole province {sec table J and 2).In each commune, the income of different groups was unequal In 3,5()0,(MH> 2,873,056 :i,(KK).(KK) 2.5(H),(KK) 1,921,528 y^ y 2,0(X).(KK) 1,246,667 Xni774,306 Jl • Phuc Triu 1.5()0.(KX) 897,576 ^^_j^^ ^ 1,(){K),{)(K) )5S,6ir a 50(),(){K) • Dong Bam 1,065,417 839,722 590,694 398433 group group group group group Figure The income per capita per month (VND) of five groups of households in Dong Bam and Phuc Triu communes in 2009 Table 1: The income per capita per month (VND) of five groups of households in Dong Bam and Phuc Triu communes in 2009 Average income of Average the two income communes Average 1.224,633 1.499,488 income By the household head - male 1,114.778 1.657.608 - female 745.439 696,478 By the ethnic group - kinh 1,332,116 1.499.488 group Norms Other groups 887,356 Cl Dong Bam groups of households G2 G3 G4 G5 Average income GI Phuc Triu groups of households G2 G3 G4 GS 558,611 897.576 1,246,667 1,921.528 2,873,056 949,778 398,333 590,694 839,722 1.065,417 1,774.306 576,667 549,583 876.144 833.333 1,242.667 1,921.528 3,276,667 966,883 1.266,667 1,575,000 635,000 431.111 300.000 594,393 550,000 846,969 760,000 1,065,417 1,776,515 1,750,000 558.611 897.576 1.246,667 1,921,528 2,873,056 996,989 473.333 590,476 800,000 1,111.250 1,894,444 866.035 344.762 591.000 868.095 973.750 1,654,167 (According to the author's investigation data) 114 Bui Dinh Hoa Tap chi KHOA HOC & CONG NGHE As shown in table the average income of all groups in Dong Bam was higher than that of Thai Nguyen province However, the gap between the average income of the richest group and the poorest group in Phuc Triu was almost equal to that of the whole province In table 3, we can see that the households of group mostly earned money from agriculture and forestry; their earnings from otherfieldswere minor Whereas, the households of group received the majority of their income through non-agricultural production and their wages These data also reflected the fact that farming families had less money than non-farming ones Causes of the differentiation between rich and poor Based on the research, we found many reasons that explained the differentiation between rich and poor among families; however, the six main reasons seemed to be the most notable explanations The first one was the influence of industrialization and urbanization The second reason was the unbalanced public investment for different economic areas Thirdly, public services were not considered adequately Lastiy, programs 82(06):! 13- 117 of poverty and hunger reduction were not practiced effectively The above-mentioned reasons were due to disadvantages of geographical location and natural conditions Certain characteristics of households also had a contribution to the rich and poor gap Solution for the limitation of the gap between rich and poor Firstly, the government should provide good conditions for the poor to develop production, increase their income and access to social services; improve people's knowledge and ability to meet the demand of the diversification program, encourage people's contribution, enhance organizations' observation, assessment and combining ability in the process of program implementation Secondly, the government should keep a harmonious relationship between economic growth and social equality Economic growth is a condition and a material base to solve social problems; on the contrary, good solutions for social issues have a contribution to the stability of politics and society, leading to permanent development of economy Table 2: Comparing the income differences of household groups in Dong Bam and Phuc Triu to those of Thai Nguyen province in 2009 No Norms Dong Bam - income per capita compared to the whole province Phuc Triu - income per capita compared to the whole province ^^*7ee income Group (VND) Group (VND) Group over (VND) '^ ^ ' '^ ^ ' group (times) 1,499,488 558,611 2,873,056 + 453,448 +111,611 + 904,056 + 43.35 + 24.97 + 45.91 949,778 398,333 1,774,306 -96,222 - 48,667 -194,694 5.14 4.45 -9.89 10.89 -9.2 Thai Nguyen province 447,000 4.40 1,046,000 mcome per capita 1,969,000 (According to ihe author's investigation data and Thai Nguyen Department of Statistic, 2009) 115 Bui Dinh Hoa 82(06):I13-1I7 T?ip chi KHOA HQC & CONG NGH$ Table 3: Income per capita per month from main economic branches in Dong Bam and Phuc Triu communes in 2009 (VND) Average income By gender of family head - male - female By ethnic group Kinh group - other groups By groups of families - Group - Group - Group - Group - Group Wages 1,148.333 833,333 1,835.285 1,200,000 1,211,111 583,333 879,629 916,667 1,800,000 1,741,379 1,306,452 979,310 848,387 920,690 Wages 2,675,000 1,906,950 Agriculture, Forestry and Fishery 1,771,667 1,419,149 1,115.385 3,148,936 961,539 2,172,702 946,154 1,353,333 , 2,675,000 1,906,950 1,208,333 1,783,333 1,566,667 1,541,667 666,667 83,333 125,000 750,000 3,958,333 8,458,333 42,667 576,417 1,733,333 1,183,333 6,000,000 Agriculture, Forestry and Fishery 1,353,333 Thirdly, the government should increase investment in agriculture and countryside in terms of infrastructure, technology and official stafiTs ability in order to exploit potentials and strength of the areas, especially to provide many employments for rural people Next, the government should focus on training and improving the quality of labor sources to both meet the demand of the integration and give labors opportunities to get jobs in the country and abroad, which helps to reduce the number of unemployed people who are becoming poor Finally, it is necessary for the government to conduct research and issue policies on how to help families with low income, especially the poorest ones in urbah areas in order to lessen pressure on the implementation of poverty reduction^])r^qjgram^._Fjor long-term solutions, the governrnent need to r^earch^build up and launch" social weAf«}i'e,^nd spo.nsorship l^ws They are 116 Phuc Triu Non-farming production Dong Bam Non-farming production Norms 1,541,667 83,333 2,216,667 166,667 650,000 1,500,000 1,225,000 1,750,000 1,558,333 1,225,000 1,850,000 3,125,000 1,700,000 (According to the author s investigation data) very important legal bases to solve the issue on social equality in the future CONCLUSION From the results of the study on the gap between rich and poor in some communes in the surrounding areas of Thai Nguyen city, we suppose that the gap between rich and poor is a socioeconomic phenomenon existing objectively and reflecting the classification of society into some groups with different economic conditions Because the gap in the city is not very serious and still controllable, its solutions are improving its advantages and reducing its disadvantages Synchronously implementing all solutions; is not to eliminate the gap betweeri rich,and poor^butto curb its growth in terms of both §eiopomy and nonreconomy, in order to enhance economic development together with sociaHnlpraivement jmd equality, thus leading tothe stab[©gjowth of ,the,09untry Bui Dinh Hoa Tap chi KHOA HQC & CONG NGHE REFERENCES r,,, , ^ „, , , , [Ij.LeDu Phong and other authors (2000), 5o/w//o« for the gap between rich and poor in Viet Nam and other countries, the Agriculture Publishing House, ^^"°'[2] Thai Nguyen Department of Statistics (2009), The results of the investigation into people's living standard in 2008, Statistical Publishing House 82(06):113- 117 [3] Hanoi national economics university (2000), Market economy and the gap between rich andpoor in ,;,, ,„ountainous areas of North Vietnam, Hanoi National Politics Publishing House [4]_ Qillis M., D H Perkins, M Roemer & D R Snodgrass (1993), Economics of Development, USA [5] Thammasat University (1996), Social Economic Indicator [6] UNDP (1999), Human Development Report TOM TAT NGHIEN ClTU SI/ PHAN HOA GIAU NGHEO d MQT S XA VUNG VEN THANH PHO THAI NGUYEN Bui Dinh Hoa* Tru&ng Dgi hgc Nong Idm - DH Thdi Nguyen Ket qua nghien cuu cua de tai cho thay sir phan hoa thu nhap kha ro net giua hai xa Dong Bam va Phiic Triu va giixa cac nhom ho a hai xa Ket qua nghi€n cuu ciia de tai cung phan anh diing thirc te, cac ho lam nong nghiep thuong co thu nhap thap hon cac ho lam phi nong nghiep Cac nguyen nhan chii yeu dan den phan hoa giau ngheo nhu: tac dong cua eong nghiep hoa va thj hoa; dau tu eong chua hop ly giua cac viing va khu vuc kinh te; djch vu eong chua duofc quan tam thoa dang; trien khai chuong trinh XDGN thieu dong bo, kem hieu qua; bat Igi ve vj tri dja ly va dieu kien tu nhien; ngheo dac diem ciia ho dan De ban che sir phan hoa giau ngheo can thirc hien dong bo cac giai phap nhu: tao co hoi de ngudi ngheo tiep can cac djch vu xa hoi; dao tao, nang cao nang lire cho nguoi ngheo; giai quyet hai boa moi quan he giiia tang truong kinh te va eong bSng xa hoi; uu tien dau tu cho nong nghiep, nong thon; nghien cuu, ban hanh chinh sach trg cap cho nguoi ngheo Tii- khoa: Thdi Nguyen, phdn hoa gidu ngheo, thu nhdp, nong thon, nguai ngheo Tel: 0983 640108 117 ... UNDP (1999), Human Development Report TOM TAT NGHIEN ClTU SI/ PHAN HOA GIAU NGHEO d MQT S XA VUNG VEN THANH PHO THAI NGUYEN Bui Dinh Hoa* Tru&ng Dgi hgc Nong Idm - DH Thdi Nguyen Ket qua nghien