(Luận văn) determinants of non farm household in come in rural vietnam

UNIVERSITY OF ECONOMICS HO CHI MINH CITY VIETNAM INSTITUTE OF SOCIAL STUDIES THE HAGUE THE NETHERLANDS t to - • ng hi ep VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS w n lo ad ju y th yi DETERMINANTS OF NON-FARM HOUSEHOLD INCOME IN RURAL VIETNAM pl n ua al va A thesis submitted in partial fulfilment of the requirements for the degree of n ll fu MASTER OF ARTS IN DEVELOPMENT ECONOMICS oi m at nh z z k jm ht BUI THANH GIANG vb By an Lu Dr NGUYEN NGOC THUY om l.c gm Academic Supervisor: n va re HO CHI MINH CITY, SEPTEMPER 2012 t to ACKNOWLEDEMENTS ng hi This is the very means that gives me a chance to formally express my ep appreciation to people who have really created the concepts and methodology w expressed in this research n lo ad I always keep in my mind the gratefulness to professors ofMDE Programme, y th executive programme administrations in Vietnam Their enthusiasm about the ju experience and what they were teaching, was the most meaningful encouragement yi pl of mine al n ua I would like to express my deep and sincere gratitude to my supervisor, va Doctor Nguyen Ngoc Thuy His knowledge, logical way of thinking and n encouragement has provided a good basic for the thesis presentation ll fu oi m I would like to express my great thanks to Professor Nguyen Trong Hoai, MDE programme who have eagerly supported during my study at nh z z k jm ht vb om l.c gm BUI THANH GIANG n a Lu n va re ii t to DECLARATION ng hi ep I declare that "Determinants of non-farm household income in rural w Vietnam" is my own work, that it has not been submitted to any degree or n lo examination at any other universities, and that all the sources used or quoted are ad indicated and acknowledged by complete references ju y th • yi Ho Chi Minh City, Septemper 2012 pl n ua al n va ll fu m BUI THANH GIANG oi at nh z z k jm ht vb om l.c gm n a Lu n va re iii t to ABSTRACT ng hi ep Vietnam has made considerable progress in improving the living standards of its people since the reforms implemented under doi moi However, the reform w progress has made problems of society such as the pressure in rural - urban n lo ad migration, an increase in unequal income distribution between different regions and y th unstable economy Therefore, a development strategy should be more focused on ju promotion of rural non-farm sector in order to create more employment and income yi pl opportunities for rural populations This paper estimated the non-farm income ua al function of households in rural of Vietnam and evaluated the importance of rural n non-farm activities in generating employment and income opportunities The va econometric analysis is based on the primary data from Vietnam Household Living n ll fu Standard Survey 2008 With 2117 observations (in rural area), the regression results oi m show that the factors such as household characteristics, regions, infrastructure, at nh occupation of household head had strong impact to non-farm household income in rural area From the regression results, this study gives some solutions to promote z z rural non-farm activities in Vietnam in the coming years k jm ht vb om l.c gm an Lu n va re iv TABLE OF CONTENTS Page t to ng hi ep Chapter 1: INTRODUCTION 1.1 Problem statement w 1.2 Research Objectives n lo 1.3 Research Questions ad 1.5 Research Structure ju y th 1.4 Research Methodology yi pl al n ua Chapter 2: LITERATURE REVIEW n va 2.1 Concepts and definitions ll fu 2.2 The role of non-farm sector m oi 2.2.1 The Push- Pull factor nh 2.2.2 The importance of rural non-farm sector at 2.2.3 The experience in the development of rural non-farm sector z z vb 2.3 Theoretical basis of the determinants of non-farm household income 13 jm ht 2.3.1 Theoretical framework 13 k 17 l.c gm 2.3 Empirical Studies 2.4 Chapter remark 20 om an Lu Chapter 3: METHODOLOGY AND MODEL SPECIFICATION 25 3.2 Data Definition 26 3.3 Data Collection 31 n 25 va 3.1 Model Specification re v 3.4 Data Analysis 31 3.5 Chapter Remark 32 t to ng hi ep Chapter 4: DETERMINANTS OF NON-FARM HOUSEHOLD INCOME IN RURAL VIETNAM 33 w n lo ad 4.1 Non- farm activities in rural Vietnam 33 y th 34 ju 4.1.1 The participation ofhousehold into non-farm activities yi pl 4.1.2 The contribution of non-farm activities in employment 40 46 46 n 4.2 Determinants of non-farm household income in rural Vietnam va ua al and household income fu 47 ll 4.2.2 The models for comparison n 4.2.1 Descriptive analysis oi m 50 4.2.3 The result ofthe model and the explanation nh 58 at 4.3 Chapter remark z z vb 60 jm ht Chapter 5: CONCLUSIONS AND RECOMMENDATIONS 60 k 5.1 Summarize main finding gm 63 l.c 5.2 Recommendations om 5.3 Limitation 66 66 an Lu 5.4 Future research APPENDICES 72 re 67 n va REFERENCE vi LIST OF TABLES Page t to ng hi ep Table 2.1: Classification of farm and non-farm activities Table 2.2: The schemes for development of non-farm sector in India 14 w Table 4.1: Participation of household into non-farm activities n lo 35 by income groups in nation ad ju y th Table 4.2: Participation ofhousehold into non-farm activities 35 yi by income groups in rural pl ua al Table 4.3: The participation ofhousehold into non-farm activities 36 n by regions and ethnic groups va 38 n Table 4.4: Business sectors participation by areas fu 39 ll Table 4.5: Business sectors participation by income groups oi m Table 4.6: Business sectors participation by ethnicity 40 at nh Table 4.7: The distribution of sources of income to household income in 2008 41 z z 42 ht vb Table 4.8: The result in urban and rural 43 Table 4.10: Labor market participation by age and schooling level, 2008 44 k jm Table 4.9: The result of income classified by ethnicity and gender om Table 4.12: Definitions of variables used in the regression model 45 l.c Table 4.11: Labor market participation by income groups gm • 46 a Lu 48 Table 4.13: Result of OLS model n n va 51 Table 4.14: Result of Robust model re vii • t to LIST OF FIGURES ng Page hi ep Figure 2.1: The framework of determinants of household income 17 w Figure 1: The framework of determinants of rural non-farm household income 25 n lo Figure 4.1: The participation of household into non-farm activities ad 34 ju y th Figure 4.2: The participation of household into non-farm activities by education of head household yi 37 pl Figure 4.3: Labor shares by income sources in 2008 ua al 45 Figure 4.4: Histogram of residuals n 50 n va ll fu oi m at nh z z k jm ht vb APPENDICES Page gm Appendix 1: Model V- Regression without Age2 to remove Multicollinearity 72 om l.c Appendix 2: Applying Robust Method to remove Het for Model V 75 n a Lu Appendix 3: Applying Robust Method with standardized Beta for Model V 74 n va re viii Chapter 1: INTRODUCTION t to The determinants of rural non-farm household income in Vietnam will be ng investigated in this chapter In particular, this chapter includes five sections The hi ep first section will raise the problem necessary to make clear for the case of Vietnam The second section will present the research objectives of this thesis The next w n section will raise the questions to obtain the proposed objectives The fourth section lo ad will briefly describe the research methodology And the structures of the thesis will ju y th be described in this chapter yi 1.1 Problem Statement pl al ua For nearly 25 years, the government of Vietnam has been looking for the n direction of socio-economic development in order to escape the rural from va n deprivation, poverty and backwardness Government has many programs to fu ll promote the new rural construction to improve people's living standards Economic m oi reform in Vietnam in the last two decades, characterized by the economic policy at nh reform, opening and operating economy towards a market economy According to z Vietnam Economic Times (20 11 ), the average economic growth increased from 7.5 z % in the period 1991 - 2002 to 8% in period 2002-2007 The economic structure vb jm ht has changed the direction towards industrialization and modernization The k proportion of agriculture in total GDP of the country declining from 27.18% in gm 1995 to 24.53% in 2000 and to 21% in 2008 The poverty rate fell consistently from l.c 58% in 1993 to 29% in 2002 and to 14,5% in 2008 (Vietnam Academy of Social om Sciences - 201 0) Economic growth and the stability of the macroeconomic an Lu environment has confirmed the correctness of innovation policy The program of mechanization, modernization of irrigation has reduced labor time re position of agriculture in the rural household economy have no meaning as before n significantly Due to the success of diversified occupations strategy, the leading va In rural areas, the process of economic restructuring also has changed - in agriculture significantly Because of the longer leisure time, the rural household can participate in the non-farm activities on a regular basis Any economic activity t to which has effective may become the main activity of household economy in rural ng The rural economy shifted towards increasing industries, services and other hi ep activities of non-farm sector The development of non-farm sector has contributed to creating jobs, increasing incomes, improving living standards for a certain part of w n residents, and creating a new face for rural area This suggests that non-farm lo ad activities play the important role in the living of households and development of ju y th economy and society ofVietnam yi The non-farm activities contributed to the improvement and diversification pl ua al of people's income This has been widely recognized Especially in rural Vietnam, n the development of non-farm sector has great meaning in solving the poverty, va underemployment and seasonal unemployment which are still the phenomenon of n ll fu the rural area Vietnam has gained remarkable achievements in improving people's oi m living standards since the reforms implemented under doi moi However, the reform nh progress has created problems of society such as the pressure in rural - urban at migration, an increase in unequal income distribution between different regions z z Furthermore, the rural - urban gap has widened considerable Therefore, an vb jm ht effective development strategy should be more focused on promotion of rural nonfarm sector in order to create more employment and income opportunities for rural k gm populations and improve other problems of society om l.c It is widely recognized that income from non-farm activities likely to play increasingly significant role in the household income in rural This study a Lu investigates the participation of rural households into non-farm activities to have an n re farm household to identify the important determinants of rural non-farm household n farm activities on household income; analyzes determinants of income of rural non- va overview of non-farm activities in rural Vietnam; identifies the contribution of non- - Employment and household income in rural non-farm activities have grown rapidly over 2004- 2008 period In rural areas, households involved in non-farm t to activities has the lowest proportion 32% vs 85% of households involved in ng agriculture And the rich households tend to participate non-farm more than poor hi ep households Non-farm activities is the most popular in Red River Delta (37%), Southeast (35%) and South Central coast (33.5%) Kinh & Hoa group tend to w n participate in non-agricultural than other ethnic groups Household in rural area lo ad tends to choose Processing industry, Construction and Trading business (total y th density of three sectors is 67% ) ju yi - In rural areas, agricultural mcome is still the mam source of income pl ua al (42.8%), non-farm incomes has low proportion (16.8%) Labor in rural areas is n mainly in the agricultural sector Non-agricultural activities are more attractive the va labors with middle education and in age from 26-45 years old This activities uses n ll fu 17.9% of total labor force of households but generate 21.8% income for households oi m While farm activities use 50% of labors but only earned 28.7% of household nh income This shows that non-farm activities provide the highest productivity at compared to other activities This shows that the important role of non-farm z z activities in generating income for households in rural areas ht vb jm - In all regions of the nation, non-farm income is highest in the Mekong k River Delta, South East and Red River Delta These also are the regions with the gm lowest poverty rate nationwide In general, income in the southern tend to be l.c significantly higher than other regions South east is the most favorable region to The non-farm income of Northwest, North Central an Lu Coast is negligible om generate non-farm income The households in this two regions participate farm with n va highest proportion education of household head and the number of household members aged 26-45 Income increases with age, while over 55 years, the income to decline The higher 61 re - Income from non-farm activities in rural areas is significantly affected by education of household head, the better opportunities to increase non-farm income of households Non-farm activity is a type of operation that need the experience and t to knowledge Then, easy to recognize the important role of education for this activity ng when you want to develop non-farm activities on a large scale The analysis also hi ep showed that households with large household size will have higher non-farm mcomes w n lo - Local market index variable has relatively strong impact to non-farm ad y th income This suggests that the development of the market exchange of goods and ju services, trading will create favorable conditions for the products of non-agricultural yi activities to consumers and creating favorable conditions for increasing of pl n ua al household income from this activity va - Infrastructure variable impact to non-farm income of households because n of high statistical significance Electricity, roadindex, factory combined with market fu ll index gives us more insight on the effects of infrastructure elements Infrastructure m oi improvement will impact the income of rural households in general In particular, nh at elements of infrastructure have important implications for households in the z highlands, the northern mountainous and Central if this factor was be improved the z ht vb households in these areas would preferred to engage in non-farm activities rather jm than agriculture In general, infrastructure is critical for poverty reduction and non- k farm development in rural areas gm l.c -Migration affects non-farm income and has negative impacts Households om with many migrant labors, the non- farm income of households tend to decrease an Lu This suggests the creation of non-farm income or participation in non-farm activities depends on the number of members in household With fewer migrant 62 re statistical significant But it belongs the group of weakest effect to non-farm income n - The appearance of traditional handicraft villages in commune has the va workers, the opportunity for non-farm income of households increased of the household This suggests that programs to encourage job creation through the development of handicraft villages is not yet effective for the development of non- t to agricultural activities As discussed, handicraft villages have more meaning when ng shifting labor from agriculture to wage employment than from agricultural to self- hi ep employment activities of households w - In the group of the occupation of household head, only few variables are n lo statistically significant The variables represent the household which the occupation ad of household head are Leader, High- level Professionals, Staff, Skilled Workers in y th ju Agriculture or Unskilled Workers not have significant at 25% The occupations yi of household head are Mid-level Professionals and Armed forces have negative pl ua al impacts to non-farm income of the household Based on the data, the households n with head of household have occupations: Skilled worker in Personal Services, i n va Skilled handicraftsmen, Assemblers & machine operators have the highest non-farm ll fu income This demonstrates that Skilled handicraftsmen and other works relating oi m skilled manual workers (such as skilled miners and builders, food processing, nh woodworking, textiles and garment, leather and shoemaking workers ) are easy to at create high non-farm income for households than in other industries z z ht vb In conclusion, this study found that non-farm income of household in rural jm areas affected by key factors such as geographic region, household characteristics k and infrastructure ofthe local gm om l.c 5.2 Recommendations Thesis found that non-farm activities play an important role in creating an Lu opportunities for employment and income, poverty reduction, development of n rural areas is a necessary option Here are some recommendations to stimulate non- va inter-sectoral linkages with the agricultural sector Promoting non-farm sector in re farm activities in rural Vietnam: 63 • From the meaning of education factor in the restructuring of labor, we need to improve the quality of rural labor forces to create the ability to t to capture investment opportunities in no-farm activities The school systems ng and teachers in rural and remote areas should be increased the investment hi ep to consolidate The strategy and plan of training for rural labors should be made in detail and be suitable for local In particular, the industries have w n practical significance to the development of the local should be focus; lo ad While encouraging the development of handicraft industry and the ju y th traditional villages, should focus on improving educational level and skills of other job for labor to increase flexibility and the ability to switch when yi pl the market for products of these activities has fluctuation ua al Because the significant effect of age of the labors (represented by the n • va ratio of household members in aged classes) for non-farm income of the n ll fu household (increasing from 16-45) The support policies for youth oi m employment in rural areas such as cultural issues, education, vocational nh training is needed The role of information technology, measures to at support rural employment for these labors should be concerned z non-farm affiliated closely together Therefore, the z Agriculture and vb jm ht expansion of agricultural services will also help for the development of non-farm activities k gm • With the important implication of the infrastructure for ability and speed om l.c of the restructuring of rural labor The policies to promote the upgrading and improving rural infrastructure on the basis of a scientific planning is a Lu very importance to develop the non-farm activities In other words, the n improvement of infrastructure in rural areas especially in the Northern 64 re urban areas and create stronger linkages with urban areas The n important to make the rural market development, reducing the gap with va sustainability of the infrastructure is to be considered This factor is very mountainous region, North Central and North Central Coast is necessary to promote non-farm activities and reduce the rate of poor in rural areas t to ng • The population of rural continued to increase and created the large hi ep pressure on employment in rural areas Therefore, the appearance of migratory flows from rural to urban areas is a common phenomenon when w the strategy of urbanization, large-scale industrialization of the developed n lo countries can not absorb a labor force developing The mass migration ad y th flow is likely to disrupt the economy, increasing poverty in urban So, ju many countries were interested in economic development in rural areas to yi encourage people stay in countryside This has implications for non- pl ua al agricultural income of the household The programs that support in finding n and creating employment as well as economic - social conditions is va necessary to attract labors in the local n fu The households with household head who have occupations are Skilled ll • m oi worker in personal services, Skilled handicraftsmen, Assemblers & nh at machine operators have the highest non-farm income Strongest effect is z Skilled handicraftsmen This demonstrates that Skilled handicraftsmen z ht vb and other relating skilled manual workers (such as skilled miners and jm builders, food processing, woodworking, textiles and garment, leather and k shoemaking workers ) are easy to create high non-farm income for gm households than in other industries According to general assessment, the om l.c products made from handicrafts, traditional crafts created superior value compare to agriculture The policies should focus on supporting and a Lu developing non-farm activities that is the advantage of local (such as n n va skilled handicraft) This will attract people to participate and create re product with high value 65 Surely, there should be more coordinated policy to encourage non-agricultural activities in rural Vietnam These are some recommendations are based on only the t to results of the thesis In fact, the comprehensive coordination of different policies for ng non-farm activities in rural areas in particular and the country in general achieve the hi ep best performance is needed w 5.3 Limitation n lo ad Thesis attempted to analyze the factors affecting non-farm income of y th households in many different aspects to be able to evaluate and make the best ju yi recommendations for the development of non-farm activities of the household But pl the limitations and shortcomings are inevitable The data using in thesis is the cross al n ua section Therefore, it is not clearly to see the change of the impact of factors over va the time The reason of this limitation due to the lack of technical ability to handle data at more complex However, the thesis is also based on previous studies to n i ll fu supplement this deficiency oi m at nh 5.4 Future research z This study will be more interesting if it is analyzed from the VHLSS data z ht vb from 93 to 2010 To see clearly the direction of the impact of factors over the time jm Such as the changing status of infrastructure impacts on non-farm income of the k household over the years, or the improvement of infrastructure will have differential gm effects on non-farm activities in each particular region over the years The om l.c recommendations will be deeper Any attempt to this is left for future research n a Lu n va re 66 REFERENCE t to Aikaeli, Jehovaness (2010) "Determinants of Rural income in Tanzania: An ng Empirical Approach" Research on Poverty Alleviation (REPOA) Tanzania hi ep Asian Productivity Organization (2004) "Non-Farm Employment Opportunities w in Rural Areas in Asia" Tokyo n lo ad Bardhan, P., and Christopher Udry (1999) "Development Economics" Oxford ju y th University Press yi Central Statistical Agency and the World Bank (2007) "Ethiopia Rural pl ua al Investment Climate Survey Basic Information Document" n Civil Code of Vietnam 2005 (No 33/2005/QH11) The Civil Code was passed va n on June 14, 2005, by the Xlth National Assembly of the Socialist Republic of ll fu Vietnam oi m nh Dasgupta, N., Kleih, U., Marter, A., Wandschneider, T (2004) "Policy at Initiatives for Strengthening Rural Economic Development in India: Case z z Studies from Madhya Pradesh and Orissa " vb jm ht Dave, Dhaval, and Dave, Rina (2012) "Role of Non-Farm Sector in Rural k Development" Arts and Education, volume no.1, issue no.7, pp.7-16 gm l.c Davis, J.R., Bezemer D.J (2004) "The Rural Non-Farm Economy in om Developing Countries and Transition Economies Key Emerging and Conceptual an Lu Issues." n Non-Farm Economy and Poverty Alleviation in Armenia, Georgia and va Davis, J.R., Bezemer D.J., Janowski, M and Wandschneider (2004) "The Rural re Romania: A Synthesis ofFindings " 67 Davis, Junior R (2003) "The Rural Non - Farm Economy, Livelihoods and Their Diversification: Issues and Option" (DFID draft) t to ng De Janvry A, Sadoulet E, Zhu N (2005) "The Role of Non-Farm Incomes in hi ep Reducing Rural Poverty and Inequality in China" CUDARE Working Paper 1001, Department of Agricultural and Resource Economics, University of w n California, Berkley lo ad Ellis, Frank (1999) "Livelihoods, Diversification and Agrarian Change." In y th Frank Ellis (ed.) Rural Livelihoods and Diversity in Developing Countries Oxford University Press yi • ju • pl ua al Ellis, Frank (2000) "The Determinants of Rural Livelihoods Diversification in n Developing Countries." Journal of Agricultural Economics, Vol.51, No.2: 289- n va 302 ll fu Delhi : Anmol Publications oi m G S Mehta (2003) "Rural Non-Farm Economy and Rural Development" New at nh z Ho, Samuel P.S (1995) "Rural Non-Agricultural Development in Post-Reform z ht vb China: Growth, Development Patterns, and Issues" Pacific Affairs 68 k jm Hymer, S., and Stephen Resnick (1969) "A Model of an Agrarian Economy gm with Non-Agricultural Activities." The American Economic Review 59(4):493- om l.c 506 lbekwe, U.C; Eze, C.C; Ohajianya, D.O; Orebiyi, J.S; Onyemauwa, C S and an Lu O.C Korie (2010) "Determinant of Non farm income among farm households in South East Nigeria" Department of Agricultural Economics, Federal n va University ofTechnology, P.M.B, 1526, Owerri, lmo State, Nigeria re 68 Islam, N (1997) "The Nonfarm Sector and Rural Development: Review of issues and evidence (Food, agriculture, and the environment discussion paper)" t to International Food Policy Research Institute ng hi ep Islam, R., & Jin, H (1994) "Rural industrialization: An engine ofprosperity in post-reform rural China" World Development w n lo Kurosaki, Takashi (2001) "Effects of Education on Farm and Non-Farm ad Productivity in Rural Pakistan" FASID Discussion Paper Series on y th International Development Strategies, No.2001-002, Tokyo: Foundation for ju yi Advanced Studies on International Development pl ua al Lanjouw P (200 1) " Non-farm Employment and Poverty in Rural El Savador " n World Development, 29(3): 529-547 n va fu Lanjouw P, Murgai R (2009) "Poverty Decline, Agricultural Wages, and ll Nonfarm Employment in Rural India: 1983-2004 " Agricultural Economics, oi m 40(2) at nh Lanjouw, J and Peter Lanjouw (2001) "The Rural Non-Farm Sector: Issues z z and Evidence from Developing Countries ", Agricultural Economics Vol 26, vb jm ht pp 1-23 k Lanjouw, J.O and P Lanjouw (1997) Rural Non-farm Employment: An gm om l.c Update Mimeo Policy Research Department World Bank Washington, D.C Malek, Mohammad Abdul and Usami, Koichi, 2010 "Do the Non-farm Incomes Development and Agricultural n Case of Advanced Villages Journal of a Lu really matter for Poverty among Small Households in Rural Bangladesh" A va n Economics Academic Journals re Ngoc, Duong (2011) "2010: Tang tru6ng cao nhung l(Jm phat cao" Vietnam Economic Times "Kinh In ti 2010- 2011 Vi?t Nam va thi giai ", pp 4-7 69 Oostendorp, R.H., Quoc Trung, T & Thanh Tung, N (2009) "The Changing Role of Non-farm Household Enterprises in Vietnam" World Development, t to 37(3):632-644 ng hi ep Pfluger,W (2000) "The Rural Nonfarm Sector, Characteristics, Importance, Policies" Paper presented at the World Bank workshop on "Non-farm rural w n development", May 2000 Washington, DC USA lo ad Rashidpour, Logman (20 11 ) "A Study on the Role of Non-farm Activities on y th Rural Sustainable Development in West Azarbaijan Province of Iran" African ju , yi Journal of Agricultural Research Vol 7(3), pp 475-481 pl ua al Reardon T, Crawford E, Kelly V (1994) "Links Between Non-farm income and n Farm Investment in African Households: Adding the Capital Market va Perspectives" Agricultural Economics, 76(5): 1172-1176 n fu ll Reardon, T (1997) "Using Evidence of Household Income Diversification to m oi Inform Study of Rural Nonfarm Labour Market in Africa" World Development, at nh 25(5):735-747 z z Reardon, T., Stamoulis, K., Balisacan, A., Cruz, M.E., Berdegue, J and Banks, vb jm ht B., (1998) "Rural Non-farm Income in Developing Countries: Importance and Policy Implications" The State of Food and Agriculture 1998 Food and k l.c gm Agriculture Organization of the United Nations Rome Sanchez, Valeria (2005) "The Determinants of Rural Non-farm Employment om and Incomes in Bolivia" Master's Thesis Michigan State University a Lu n Singh, 1., L Squire, and J Strauss, eds (1986) "Agricultural Household n va Models: Extensions, Applications, and Policy" Baltimore: Johns Hopkins re University Press 70 Trung, Tran Quoc (2000) "Determinants of Income from Rural Non-Farm Business Activities in Vietnam.", Master's Thesis, National Economics t to University, Hanoi ng hi ep Van der Walle, Dominique & Cratty, Dorothyjean (2003) "Is the Emerging Nonfarm Market Economy the Route out of Poverty in Vietnam?" Policy w n Research Working Paper Series 2950, The World Bank lo ad Vietnam Academy of Social Sciences (20 10) "Poverty Reduction in Vietnam: y th ju Achievements and Challenges " yi pl Vijverberg, W P (1998) "Nonfarm Household Enterprises in Vietnam." In al ua David Dollar, Paul Glewwe, and Jennie Litvack, eds., Household Welfare and n Vietnam's Transition World Bank Washington, D.C n va ll fu WimP M Vijverberg, Jonathan Haughton (2002) "Household Enterprises in at nh Paper Series 2773, The World Bank oi m Vietnam: Survival, Growth and Living Standards " Policy Research Working z Xu, C., and Zhang, X (20 10) "The Evolution of Chinese Entrepreneurial z k jm ht vb Firms: Township-village Enterprises Revisited" om l.c gm n a Lu n va re 71 APPENDIXES t to Appendix 1: Model V- Regression without Age to remove Multicollinearity ng ss Source MS df hi ep Model Residual n lo ad 36 38.6950234 Prob > F R-squared 0.3182 Adj R-squared 0.3064 RootMSE 1.1978 Genderhead ju y th Agehead yi pl Years schooling 2116 2.06875158 Std Err P>t t f95% Conf Interval] 0.0073 0034828 2.08 0.04 0.0004 0.0141 -0.0886 0809871 -1.09 0.27 -0.2474 0.0703 0.0639 0086471 7.39 0.00 0.0470 0.0809 0.1074 0208151 5.16 0.00 0.0666 0.1482 0.2068 0518846 3.99 0.00 0.1050 0.3085 0.5297 2109954 2.51 0.01 0.1159 0.9435 3618522 4.38 0.00 0.8741 2.2933 3617815 5.83 0.00 1.4011 2.8201 3466077 n ua Dependency ratio al Hhsize 26.97 2080 1.43483534 w - F( 36, 2080) 1393.0208 Coef log(non-fann income) 2117 2984.4575 4377.4783 Total Number of obs n 1.5837 fu Persons aged 36-45 years va Persons aged 16-25 years Persons aged 26-35 years ll 2.1106 1.3325 Persons aged 56-65 years 0.5681 3.84 0.00 0.6527 2.0122 3790953 1.50 0.13 -0.1754 1.3115 0.33 -0.7729 0.2567 0.05 -0.0034 0.8296 0.00 0.0000 0.0000 0.00 -0.5378 -0.1832 0.7155 1.5872 0.2813 0.7271 0.2257 0.9336 0.1460 0.3686 oi 2625269 -0.98 Number of women aged >=16 years 0.4131 2123817 1.95 Landsize 0.0000 1.80e-06 -4.64 Migration -0.3605 0903993 -3.99 Roadindex 1.1514 2222506 5.18 0.00 Marketindex 0.5042 1136483 4.44 0.00 Electricity 0.5796 1804822 3.21 0.00 Factory 0.2573 0567737 4.53 0.00 Red River Delta 1.2280 1460289 8.41 0.00 0.9416 at -0.2581 nh Persons aged over 65 years m Persons aged 46-55 years z z k jm ht vb om l.c gm a Lu 1.5144 n 1.3509 1.0712 1426261 7.51 0.00 North Central Coast 1.0330 1550615 6.66 0.00 0.7289 1.3371 South Central Coast 1.3794 1578752 8.74 0.00 1.0697 1.6890 n va Northeast 0.7915 1.1716 1720293 6.81 0.00 0.8343 1.5090 South East 2.0497 1550278 13.22 0.00 1.7457 2.3537 Mekong river Delta 1.8022 1416143 12.73 0.00 1.5245 2.0799 72 re Central Highlands Traditional handicraft I Leaders ~ High-level professionals t to I Mid-level professionals ng • Staff hi ep Skill workers in personal services Skill workers in agriculture Skill handicraftsmen w n Assemblers & machine operators 0767466 1.57 0.12 -0.0299 0.2711 -0.1635 2279628 -0.72 0.47 -0.6106 0.2836 -0.0544 4273716 -0.13 0.90 -0.8925 0.7837 -0.2783 2520663 -1.10 0.27 -0.7727 0.2160 0.1681 3228867 0.52 0.60 -0.4651 0.8014 0.7031 1708274 4.12 0.00 0.3681 1.0381 -0.1225 1861405 -0.66 0.51 -0.4876 0.2425 0.3732 1504346 2.48 0.01 0.0782 0.6682 0.4200 1913627 2.19 0.03 0.0447 0.7952 Unskilled workers -0.0155 132749 0.91 -0.2759 0.2448 ad -2.9270 1.212283 -2.41 0.02 -5.3044 -0.5496 3.3122 4148194 7.98 0.00 2.4987 4.1257 lo Armed forces I ju cons y th • 0.1206 -0.12 yi pl n ua al n va ll fu oi m • at nh z z k jm ht vb om l.c gm an Lu n va re 73 Aooendix 2: A t to 2117.0000 R-squared 0.3182 F( 35, 2080) = RootMSE 1.1978 Prob> F = ng "' Number of obs Robust hi ep Coef log(non-farm income) Interval] 0.03 0.0007 0.0138 -0.0886 0.0753 -1.18 0.24 -0.2362 0.0591 0.0639 0.0086 7.43 0.00 0.0471 0.0808 0.1074 0.0227 4.72 0.00 0.0628 0.1520 0.2068 0.0490 4.22 0.00 0.1106 0.3030 Persons aged 16-25 years Persons aged 26-35 years 0.5297 0.2172 2.44 0.02 0.1037 0.9557 1.5837 0.3667 4.32 0.00 0.8645 2.3028 Persons aged 36-45 years 2.1106 0.3607 5.85 0.00 1.4032 2.8179 Persons aged 46-55 years 1.3325 0.3148 4.23 0.00 0.7150 1.9499 Persons aged 56-65 years 0.5681 0.3557 1.6 0.11 -0.1295 1.2657 0.2442 -1.06 0.29 -0.7369 0.2207 w n lo ad Dependency ratio ju y th yi pl al -0.2581 Number of women aged >=16 years 0.4131 0.2143 1.93 0.05 -0.0072 0.8335 0.0000 0.0000 -4.51 0.00 0.0000 0.0000 -0.3605 0.0843 -4.28 0.00 -0.5259 -0.1951 1.1514 0.2670 4.31 0.00 0.6277 1.6751 Marketindex m 0.1345 3.75 0.00 0.2403 0.7680 Electricity 0.5796 0.2923 1.98 0.05 0.0064 1.1528 Factory 0.2573 0.0558 4.61 0.00 0.1479 0.3667 n ua Persons aged over 65 years ll fu Roadindex n Migration va Landsize 0.5042 oi 5.66 0.00 0.8025 1.6534 z at nh 0.2169 4.95 0.00 0.6472 1.4952 4.66 0.00 0.5984 1.4675 5.94 0.00 0.9240 1.8347 4.64 0.00 0.6760 1.6673 9.3 0.00 1.6176 2.4818 0.00 1.3834 2.2210 North Central Coast 1.0330 0.2216 South Central Coast 1.3794 0.2322 Central Highlands 1.1716 0.2527 South East 2.0497 0.2203 Mekong river Delta 1.8022 0.2136 Traditional handicraft 0.1206 0.0687 1.76 k jm ht vb 8.44 -0.0141 0.2552 0.51 -0.6512 0.3242 -0.9089 0.8001 0.1435 0.08 l.c Northeast 0.2162 gm 1.2280 1.0712 z Red River Delta -0.1635 0.2487 High-level professionals -0.0544 0.4357 -0.12 0.90 Mid-level professionals -0.2783 0.2151 -1.29 0.20 -0.7002 Staff 0.1681 0.2614 0.64 0.52 -0.3444 0.6807 Skill workers in personal services 0.7031 0.1558 4.51 0.00 0.3975 1.0087 -0.1225 0.1722 -0.71 0.48 -0.4603 0.2152 Skill handicraftsmen 0.3732 0.1436 2.6 0.01 0.0915 0.6548 Assemblers & machine operators 0.4200 0.1844 2.28 0.02 0.0584 0.7815 Unskilled workers -0.0155 0.1264 -0.12 0.90 -0.2634 0.2323 Armed forces -2.9270 0.1906 -15.36 0.00 -3.3008 -2.5532 3.3122 0.4777 6.93 0.00 2.3754 4.2490 n va re 74 an Lu cons om Leaders -0.66 Skill workers in agriculture • [95% Conf 2.18 Hhsize • P>t 0.0033 Years schooling • t 0.0073 Agehead Genderhead • Std Err A,ppen d"IX A•PPlvine: Robust Method with standardized Beta for Model V log(non-farm income) t to ng hi ep Agehead Genderhead Years schooling Hhsize Dependency ratio Persons aged 16-25 years Persons aged 26-35 years Persons aged 36-45 years Persons aged 46-55 years Persons aged 56-65 years Persons aged over 65 years w n lo ad ju y th yi Number of women aged >=16 years pl n ll fu oi m at nh z z k jm ht gm om l.c Beta 0.0620 -0.0240 0.1614 0.1185 0.0980 0.0571 0.1207 0.1730 0.1064 0.0390 -0.0297 0.0493 -0.0926 -0.0764 0.1062 0.0854 0.0612 0.0878 0.3718 0.2583 0.2248 0.2768 0.1769 0.4315 0.5047 0.0308 -0.0162 -0.0025 -0.0243 0.0104 0.1108 -0.0161 0.0895 0.0554 -0.0053 -0.0442 n a Lu n va P>t 0.03 0.24 0.00 0.00 0.00 0.02 0.00 0.00 0.00 0.11 0.29 0.05 0.00 0.00 0.00 0.00 0.05 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.08 0.51 0.90 0.20 0.52 0.00 0.48 0.01 0.02 0.90 0.00 0.00 t 2.18 -1.18 7.43 4.72 4.22 2.44 4.32 5.85 4.23 1.6 -1.06 1.93 -4.51 -4.28 4.31 3.75 1.98 4.61 5.66 4.95 4.66 5.94 4.64 9.3 8.44 1.76 -0.66 -0.12 -1.29 0.64 4.51 -0.71 2.6 2.28 -0.12 -15.36 6.93 vb re Staff Skill workers in personal services Skill workers in agriculture Skill handicraftsmen Assemblers & machine operators Unskilled workers Armed forces cons n va r ua al Landsize Migration Roadindex Marketindex Electricity Factory Red River Delta Northeast North Central Coast South Central Coast Central Highlands South East Mekong river Delta Traditional handicraft Leaders High-level professionals Mid ;level professionals Coef 0.0073 -0.0886 0.0639 0.1074 0.2068 0.5297 1.5837 2.1106 1.3325 0.5681 -0.2581 0.4131 0.0000 -0.3605 1.1514 0.5042 0.5796 0.2573 1.2280 1.0712 1.0330 1.3794 1.1716 2.0497 1.8022 0.1206 -0.1635 -0.0544 -0.2783 0.1681 0.7031 -0.1225 0.3732 0.4200 -0.0155 -2.9270 3.3122 Robust Std Err 0.0033 0.0753 0.0086 0.0227 0.0490 0.2172 0.3667 0.3607 0.3148 0.3557 0.2442 0.2143 0.0000 0.0843 0.2670 0.1345 0.2923 0.0558 0.2169 0.2162 0.2216 0.2322 0.2527 0.2203 0.2136 0.0687 0.2487 0.4357 0.2151 0.2614 0.1558 0.1722 0.1436 0.1844 0.1264 0.1906 0.4777 75