FACTORS AFFECTING INCOME INEQUALITY IN VIETNAM FROM 2010 TO 2020: EMPIRICAL EVIDENCE FROM PROVINCIAL LEVEL

Thu VAN Dinh Tue and Xuan Truong Pham

Regional and Sectoral Economic Studies, 2024, vol. 24, issue 1, 67-90

Abstract: This paper aims to investigate factors affecting income inequality in Vietnam. The panel random effects model (RE) analyses a balanced (but with gaps) panel dataset collected from 63 provinces from 2010 to 2020. The estimated results reveal that apart from provincial competitiveness index (PCI), all of the rest variables, which are population, average urban population, education (percentage of literate population at 15 years of age and above), employee quality (percentage of trained employed workers at age 15 and above), monthly income per capita and Gross Regional Domestic Product (GRDP) significantly impact income inequality in Vietnam. Especially, percentage of literate population of at least 15 years old and gross regional domestic product are two variables that negatively affect income inequality at the significant level of 1%. Besides, only average urban population and monthly income per capita variables have positive effect on income inequality. Based on the estimated result, there will be policies and recommendation to reduce the income gap and promote sustainable development in Vietnam.

Keywords: Inequality; GINI coefficient; provincial analysis; Panel random effects model. (search for similar items in EconPapers)
Date: 2024
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