(Luận văn thạc sĩ) an explanation for vietnams recent migration pattern based on cumulative causation theory and relative deprivation theory

UNIVERSITY OF ECONOMICS HO CHI MINH CITY VIETNAM ERASMUS UNVERSITY ROTTERDAM INSTITUTE OF SOCIAL STUDIES THE NETHERLANDS VIETNAM – THE NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS AN EXPLANATION FOR VIETNAM’S RECENT MIGRATION PATTERN BASED ON CUMULATIVE CAUSATION THEORY AND RELATIVE DEPRIVATION THEORY BY Vu Thu Ha MASTER OF ARTS IN DEVELOPMENT ECONOMICS HO CHI MINH CITY, DECEMBER 2017 UNIVERSITY OF ECONOMICS HO CHI MINH CITY VIETNAM INSTITUTE OF SOCIAL STUDIES THE HAGUE THE NETHERLANDS VIETNAM - NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS AN EXPLANATION FOR VIETNAM’S RECENT MIGRATION PATTERN BASED ON CUMULATIVE CAUSATION THEORY AND RELATIVE DEPRIVATION THEORY A thesis submitted in partial fulfilment of the requirements for the degree of MASTER OF ARTS IN DEVELOPMENT ECONOMICS By Vu Thu Ha Academic Supervisor: Prof Dr Nguyen Trong Hoai HO CHI MINH CITY, DECEMBER 2017 DECLARATION I hereby declare that this thesis paper entitled “An explanation for Vietnam’s recent migration pattern based on cumulative causation theory and relative deprivation theory” has been written by me, representing the result of my own work, in compliance with the guidelines and disciplines of Vietnam Netherlands Programme The contribution of my supervisor and collaboration with others, specified in the acknowledgement, to fulfill this research are consistent with normal supervisory practice This dissertation, or any substantial part of this dissertation, has not been submitted for any previous qualifications or any other institutions Date: 01 December 2017 Signature: _ Full name: Vu Thu Ha i ACKNOWLEDGEMENT It is impossible for me to finish my thesis without the guidance from my supervisor, Prof Dr Nguyen Trong Hoai, knowledges provided by Vietnam Netherlands Programme, help from my classmates and supports from my family First and foremost, I would like to send my special thanks to my supervisor, Prof Dr Nguyen Trong Hoai, who is always ready to steer me to the right direction, to give me useful advices when I have trouble with my research and to motivate me to explore my ability I am so grateful for all of his dedication and devoted attention in every single step in my journey of conducting this research Having a chance to work with him is really an unforgettable experience in my life I would also like to thank Dr Pham Khanh Nam, Dr Truong Dang Thuy and all other lectures and mentors from Vietnam Netherlands Programme for their valuable lessons, guidance and knowledge that they shared to me throughout the program I appreciate all of wonderful experience and fantastic friends in class VNP22 that I’m luckily obtained thanks to attaining this course Last but not least, I must express my profound gratitude to my family for providing me unconditional supports and unceasing encouragement that I can pursue my learning desire From bottom of my heart, I want to say thank you all ii ABSTRACT This paper combines cumulative causation theory and relative deprivation theory to explain incentives and influences on decision to send migrants of a household, concerning interaction of the household’s characteristics, especially factors related to income, and the features of the origin community Two subsets of data from two successive Vietnam Household Living Standards Surveys (VHLSS) in period from 2010 to 2014 are established and employed to avoid endogeneity in the analysis of migration pattern in Vietnam in 2012 and 2014 By using logit method and combination of difference-in-difference (DID) and propensity matching score method (PSM), we find some interesting results that have never been found in previous empirical studies for Vietnam case First, the competitiveness competence level of the origin province may reduce possibility of work migrants Furthermore, relative income status before migration event, represented by ratio of income per capita of a household over the average income per capita in the origin province, may positively affect the possibility of sending migrants of the household Then, returns from migration, could create a significantly positive effect on the relative income status of the household at the origin via remittance channel, generating an automatic mechanism in migration progress as expected in the cumulative causation theory Keywords: migration, cumulative causation theory, relative deprivation, remittance, relative income, PCI JEL classification: O15, F24, D31 iii TABLE OF CONTENTS I INTRODUCTION 1.1 Problem statement 1.2 Research questions 1.3 Research objectives 1.4 Data and methods 1.5 Thesis structure II LITERATURE REVIEWS 2.1 Migration theory reviews 2.2 Relative deprivation theory 15 2.3 Remittance – the link between the migrants and their origin 17 2.4 Conceptual framework 18 2.5 Empirical studies 21 III METHODOLOGY 26 3.1 The dataset 26 3.2 Main applicable concepts 27 3.3 Stage one: examining determinants of migration 29 3.3.1 Model 29 3.3.2 Variables 31 3.4 IV Stage two: testing effects of migration 32 RESULTS AND DISCUSSION 35 4.1 Determinants for migration in Vietnam in 2012 and 2014 35 4.2 Impacts of migration on income and expenditure in Vietnam in 2012 and 2014 50 V CONCLUSION 60 5.1 Main findings 60 5.2 Policy implication 62 5.3 Limitation of the study 63 REFERENCES 64 APPENDIX 68 Annex 1: Descriptive statistics of explanatories in year 2010 68 Annex 2: Descriptive statistics of explanatories in year 2012 71 iv LIST OF FIGURES Figure 1: A general framework of migration decision making 10 Figure 2: The conceptual framework for the migration pattern in relation with the relative income status of a household and the origin community 21 Figure 3: Difference-in-Difference estimation, graphical explanation 33 v LIST OF TABLES Table 1: Logit regressions of determinants of migration in period 2010-2012 36 Table 2: Logit regressions of determinants of migration in period 2012 -2014 42 Table 3: Impact of migration on income and expenditure in 2012 52 Table 4: Impact of migration on income and expenditure in 2014 55 vi ABBREVIATION DID Difference-in-Difference PCI Provincial Competitive Index PSM Propensity Matching Score US or USA The United States of America VHLSS Vietnam Household Living Standards Survey VMS Vietnam Migration Survey VNDHS Viet Nam Demographic and Health Survey VNMHS Viet Nam Migration and Health Survey WTO World Trade Organization vii I INTRODUCTION 1.1 Problem statement According to Migration Policy Institute (MPI), an independent, non-partisan, non-profit think tank of specialists and analysts on migration field, the year 2016 is a remarkable one for the migration worldwide Notably, the upheavals in the political and economic situation of powerful nations and affiliates lead to a dramatic crisis in movement of capital and labor around the world For example, the European migrant crisis began in 2015 with significantly increase of immigrants and refugees arrived in the European Union As stated by The New York Times, there are over 123,000 migrants landed in Greece in the two first months of 2016, which is more than twenty times greater in comparison with the same period of 2015 This fact challenges authorizes and policy-makers in the European Union to take prompt actions and provide relevant policy to better manage immigration issues and protect the living standard of native people In the United States of America, one of the most powerful country in the world, the new president, Donald Trump, takes office, pledging a fasten immigration policy in the US that including a crackdown on illegal immigration, construction of border walls, reductions in refugee and immigrant admissions, and greater screening of newcomers All of these facts and actions in the last recent years illustrate for the increasing importance meaning of migration problem in association with the socio-economic situation The report of the World Trade Organization (WTO, 2008) notices the first explosion of migration happened in the 1950s as the consequence of the World Wars, then gradually increasing before booming in the latter half of the 20th century Castles, De Haas, and Miller (2013) describe the general patterns of International population movements in the modern world as globalization of migration relating to the diversification of sending countries and the spread in spectrums of economic, social and cultural background; having changes in the direction of dominant ... generating an automatic mechanism in migration progress as expected in the cumulative causation theory Keywords: migration, cumulative causation theory, relative deprivation, remittance, relative. .. advance in migration theory J E Taylor and Fletcher (2001) declare that the NELM is the only migration theory that explicit the connection between migration and impact of migration via remittance... and expansion of the NELM, another school of migration theory has been formulated and improved to interpret the internal dynamics of migration, called cumulative causation Cumulative causation