THE IMPACT OF GENDER INEQUALITY ON DEVELOPMENT IN VIETNAM

The topic " The impact of gender inequality on development in Vietnam" has been chosen as the thesistheme.. As gender inequality is signifying in a number of aspects andthe meaning of de

AND TRAINING AND INVESTMENT

CENTRAL INSTITUTE FOR ECONOMIC MAMANGEMENT

LUONG THI NGOC OANH

THE IMPACT OF GENDER INEQUALITY ON

Scientific advisors: Dr Nguyen Thi Tue Anh

Assoc Prof Dr Chu Tien Quang Examiner 1: Dotor Dao Quang Vinh

Examiner 2: Associate Professor, Doctor Bui Tat Thang

Examiner 3: Associate Professor, Doctor Le Xuan Ba

This thesis shall be defended before Institute-level ThesisExamination Council of Central Institute for Economic Management at

… on ……… 2016

Can be looked up at libraries of:

- Central Institute for Economic Management, Hanoi

- National Library, Hanoi

1 The relevance of the research topic

Gender equality is one of the eight Millennium DevelopmentGoal, and also one of a country's societal development and has inspiredinterests of academic circle Dollar and Gatti (1999), ), Klasen (2002),Klasen and Lamanna (2009), Abu-Ghaida and Klasen (2004) havejustified negative impacts of gender inequality on development.However, a number of other research works found controversialconclusions, such as the one by Seguino (2000) and that by Schoberand Winer-Ebmer (2011) Besides, Bandiera and Natraj (2013) confirmthat findings in research works done with case study of one or a number

of countries can hardly hold true for others, so research should be donefor each country when development policies for that country are about

to made

The Communist Party, the Prime Minister and the National Committee for the Advancement of Women in Vietnam have put emphasis on the goal of gender equality and put forward relevant policies, strategies and regulations However, Vietnamese women are still discriminated against in such aspects

as employment, health, social recognition Thus, research to work out solutions relating to gender inequality in order to boost development in Vietnam is very important.

2 Purpose, significance of the thesis

2.1 Purpose

Due to the fact that progress toward the aim of gender equality

is not remarkable although there have been interventions to reducegender inequality, the thesis is done with the main purpose of assessingthe factual situation, its impacts in order to make recommendations to

promote development in Vietnam The topic " The impact of gender inequality on development in Vietnam" has been chosen as the thesis

theme

As gender inequality is signifying in a number of aspects andthe meaning of development is quite broad, the thesis confined itsresearch in two aspects: education and employment for genderinequality (GI)) and economic growth (EG) and human development(HD) for development The thesis can become reference fordevelopment policy-makers in Vietnam

2.2 Significance

The thesis will make both theoretical contribution andempirical evidence regarding the impact of gender inequality oneconomic growth and human development with a specific case ofVietnam

2.2.1 Theoretical contribution

The thesis will make contribution with regard to methodology

of assessing the factual situation, analyzing the impact and influentialfactors of gender inequality in order to be theoretical reference to futureresearch

2.2.2 Empirical contribution

Based on the analysis and assessment of Vietnam, the thesisalso make policy recommendations relating to gender inequality inorder to boost development and to be of reference to developmentpolicy makers

CHAPTER 1 LITERATURE REVIEW AND RESEARCH PLAN

1.1 Literature review relating to impact of gender inequality on development

1.1.1 Theoretical research works on the impact of GE on

development

1.1.1.1 The impact of GI on economic growth

Barro and Lee, Dollar and Gatti, Klasen and Lamanna,Braustein have done research based on the Neoclassical EG model -Solow model- to identify the impact of GI on factors directly orindirectly contributing to EG

(1) The impact of GI in education on economic growth

Klasen and Lamanna (2009), Ferrant (2011), Seguino (2000)have confirmed that GI will hinder EG by reducing human capital,marginal utility of education, discouraging investment, limiting theopportunity to take advantage of "golden population stage", limiting thechance to utilize relatively cheaper female labor in order to improvecompetitiveness in the world economy and hence hampering EG

(2) The impact of GI in employment on economic growth

Klasen and Lamanna (2009), David and Teignier-Baque(2012), Seguino (2000), WB (2001) have come to a conclusion thatgender inequality in employment is inefficient and make distortion inthe economy in a similar manner to gender inequality in education due

to higher fertility rate, little chance to utilize relatively cheaper femalelabor for improving competitiveness, discouraging investment in long-term human development, possibility of corruption and thus making theeconomy work less efficiently

1.1.1.2 The impact of GI on human development

Theories in this theme usually originated from microeconomictheories on labor division between husband and wife; on the right toallocate family income and on gender differences in spending andinvestment behaviors.

(1) The impact of GI in education on human development

Klasen (2002) has proved that education for mothers havepositive impacts on education for children through direct supports orcreation of favorable study environment; when siblings or spouses inone family have equivalent education levels, they can make mutualsupports for one another Hill and King (1995) have also confirmed thatmothers' education have greater impact on children's education thanfathers'; there are four channels through which female education canpositively affect family health care These conclusions mean that GI ineducation negatively affects family health care Moreover, Klasen(1999) and Mikkola (2005) believed that once GI in education is lesssevere and women have greater knowledge and thus, can be employed,female's opportunity costs of bearing and raising children becomehigher, the fertility rate will be lower, the resources devoted for eachchild will be greater, children's health care and education condition will

be improved or their budget portion for education and health care willincrease This means GI in employment will have negative impact onHD

(2) The impact of GI in employment on human development

Lundberg and Pollak (1996) conclude that who earn familyincome will have decision-making power and that husband and wifehave different ways of allocating income between different uses.Ferrant (2011) and Thomas and Strauss (1997) believe that GI inemployment adversely affect HD as when women have no decision -making power regarding family spending, the efficiency of family

expenditure will become lower as male usually spend less for educationfor children and health care.

1.1.2 Empirical research on impact of GI on development

1.1.2.1 Empirical research for group of countries

(1) Impact of GI on economic growth

As it is difficult to disaggregate the impact of GI in eacheducation and employment in empirical research and empirical researchworks usually evaluate GI in a number of aspects, following is thereview of empirical research in both dimensions The widely usedmethodology applied in finding out about causational relationshipbetween GI and EG is to take correlation coefficients or regression withcross section, time series or panel data Dependent variables are usuallyGDP or GNP, growth rate per capita income or total factorproductivity; independent variables include those in Neoclassical modelsuch as: capital or investment, labor force or human capital, openness

or trade volume and variables representing GI

Barro and Lee (1994), Dollar and Gatti (1999), Klasen (2002),Klasen and Lamana (2009), Schober and Winter- Ebmer (2011) haveanalyzed groups of countries and concluded that GI in employment orincome have negative impacts on EG However, Seguino (2000) holdthat GI in pay with lower salary for female employees can help labor-intensive export industries improve their competitiveness by takingadvantage of lower labor cost and hence back up economic growth

Martin and Garvi (2009) has done a research into the case ofSpain and confirms that EG, gender development and HD are positivelycorrelated for groups of provinces with very high or very lowdevelopment level Pervaiz and et al (2011) has analyzed EG inPakistan and comes to a conclusion that GI has negative impacts on EG

in the long-term Tansel, A et al (2012) have investigated EG of

Turkey by applying Cobb-Douglas with the disaggregation of male andfemale education variables and confirms that GI has significantly andnegatively impacted on labor productivity.

(2) The impact of GI on HD

Methodologically, empirical research is based on regression orcorrelation based on cross-section or panel data with provinces andcountries serving as unit of analysis

A research about a group of nations by Hill and King (1995),findings by Mikkola (2005) about Finland, by Maiga (2011) aboutBurkina Faso all confirm negative impact of GI in education on HD inboth short- and long-term

Mikkola (2005) points out that when there is a transfer ofdecision-making power from a husband to a wife the percentage offamily budget spent for children increases Similarly, a research work

by Morrison et al (2007) also affirms a conclusion that femalehousehold head devote more family resources for kids This means GIhas negative impact on HD

1.1.2.2 Research on Vietnam

WB (2008) affirms a conclusion that the acknowledgement ofboth husband's and wife's on land use right certificate can increaseinvestment opportunities and improve the livelihood for old agewomen A research work by Duvvury, N., Carney, P and Dr NguyenHuu Minh (2012) gives an estimate that the total opportunity cost ofdomestic violence can be approximately 1.41% of Vietnam's GDP in

2010, which is equivalent to 2,536,000 bn

Moreover, there is research project leaded by Dr Nguyen ThiNguyet (CIEM) which has pointed put factors affecting GI in income inVietnam and has made a number of relevant recommendations.Research works by Lee, S (2008); Rodger & Menon (2010); WB

(2011), Nguyen Viet Cuong (2012) have investigated factual status of

GI in Vietnam but have not evaluated the impact of GI or causes of GI.Relating to gender stereotype and causes of GI there is pieces of work

by Wendy N Duong (2001), UNFPA (2013) Besides, a doctoral thesis

by Nguyen Quynh Hoa has investigated the factual situation and factorsassociated with gender equality in access to productive land inVietnam

1.1.3 Contributions and unsolved issues in reviewed literature

1.1.3.1 Contributions

Theoretically, previous research works have pointed outaspects having signals of GI, measures of GI and suggested somemodels for assessing the impact of GI on development

Empirically, previous research works have shown aspectshaving signals of GI, causes of GI, models of EG and development withincorporating gender aspect; pointed out technical mistakes ofquantitative analysis

1.1.3.2 Unsolved issues

Previous research works are mainly done for groups ofcountries and the research into impact of GI on development inVietnam is still kept open

1.2 Tentative research plan

1.2.1 Research objective

The overall objective is to investigate the impact of GI ineducation and employment on EG and HD in order to work out somesolutions relating to GI and its impacts to promote Vietnam'sdevelopment

1.2.2 Research object and scope

1.2.2.1 Research object

Research object of the thesis is the impact of GI ondevelopment in Vietnam.

1.2.2.2 Research scope

(1) content scope

Relating to GI, the thesis covers GI in education andemployment Relating to development, the thesis limit to two majorpillars of development: EG and HD

Based on literature review and the research scope (in 1.1.2 Chapter 1), the second research question concerns the followinghypotheses:

-H1: GI in education has negative impact on EG

H2: GI in employment has negative impact on EG

H3: GI in education has negative impact on education for the nextgeneration

H4: GI in education has negative impact on family health care

H5: GI in employment has negative impact on education for the nextgeneration

H6: GI in employment has negative impact on family health care

1.2.4 Research approach and research methodology

1.2.4.1 Research approach

Based on literature review (Chapter 1), the thesis adapt

theoretical framework and methodology to evaluate the impact of GI

(Chapter 2) Then, the thesis analyze the factual situation, assess the

impact and the factors affecting GI in education and employmentthrough regression, correlation, Blinder - Oaxaca decomposition and

qualitative reasoning (Chapter 3) Basing on the findings, the

recommendation with regard to development promotion in Vietnam in

the future will be made (Chapter 4).

The thesis employs such reasoning methodologies as: dialecticreasoning, induction and intuition, synthesizing and analysis,generalization.

1.2.4.3 Data analysis method

The thesis largely utilize quantitative methods such asregression, descriptive analysis, correlation using cross-section or paneldata, Blinder-Oaxaca decomposition and qualitative analysis

1.2.4.4 Data source

Data to be used are mainly secondary data extracted from theseries of household living standard surveys (VHLSS - GSO), laborforce surveys, (LFS- MOLISA), Provincial socio-economic data(Provincial Departments of Statistics), data released by WB, UNDP…

CHAPTER 2 THEORETICAL FRAMEWORK AND METHODS TO ANALYSE THE IMPACT OF GENDER

b Measurements

Composition measurements include GDI and GEM, with valueranging from 0 to 1, the closer the value to 1, the lower the degree ofgender inequality

2.1.2 Development

Development is a broad concept, in which EG, structuralchange and human development are main components

2.1.2.1 Economic growth (EG)

Economic growth is an increase in the gross domestic products,gross national products or per capita income Economic growthmeasurement widely used is growth rate of GDP

2.1.2.2 Human development (HD)

According to UNDP, "human development is a procees ofexpanding human being's choices, in which the most importatnt choicesare assuring a long, healthy life with adequate education " HDI isused to measure a nation's progress in human development

2.2 Theories and methodology to assess the impact of gender inequality in education and employment on economic growth

2.2.1 Theories relating to the impact of gender inequality in

education and employment on EG

2.2.1.1 Theories relating to the impact of GI in education on EG

The thesis employs theories and models developed by Klasenand Seguino

GI in education existing now is mostly bias against women:less women are having opportunity to go to school or having lessnumber of schooling This hamper EG in four following ways

First, limiting the average connate talents of educated kids (regardlessboys or girls) and thus limiting the economy's average human capital.Second, limiting the marginal economic benefit of education (according

to diminishing marginal economic benefits) Third, restricting theopportunity to intensively utilize female labor with relatively lower pay

in export-oriented labor-intensive industries Fourth, limiting thechance to take advantage of positive externality of gender equality such